Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Mar. 31, 2020 | May 08, 2020 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | NETSOL TECHNOLOGIES INC | |
Entity Central Index Key | 0001039280 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --06-30 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 11,791,194 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2020 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 15,743,328 | $ 17,366,364 |
Accounts receivable, net of allowance of $364,383 and $192,786 | 12,900,412 | 12,332,714 |
Accounts receivable, net of allowance of $54,307 and $166,075 - related party | 1,332,575 | 3,266,600 |
Revenues in excess of billings, net of allowance of $190,811 and $194,684 | 15,301,150 | 14,719,047 |
Revenues in excess of billings - related party | 8,245 | 110,827 |
Convertible note receivable - related party | 4,250,000 | 3,650,000 |
Other current assets | 3,593,365 | 3,146,264 |
Total current assets | 53,129,075 | 54,591,816 |
Revenues in excess of billings, net - long term | 1,282,898 | 1,281,492 |
Property and equipment, net | 11,553,814 | 12,096,855 |
Right of use of assets - operating leases | 2,690,777 | |
Long term investment | 2,329,706 | 2,653,769 |
Other assets | 23,066 | 23,569 |
Intangible assets, net | 5,880,759 | 7,332,950 |
Goodwill | 9,516,568 | 9,516,568 |
Total assets | 86,406,663 | 87,497,019 |
Current liabilities: | ||
Accounts payable and accrued expenses | 7,107,933 | 7,476,560 |
Current portion of loans and obligations under finance leases | 8,794,858 | 6,905,597 |
Current portion of operating lease obligations | 1,146,696 | |
Unearned revenues | 3,440,663 | 5,977,736 |
Common stock to be issued | 88,324 | 88,324 |
Total current liabilities | 20,578,474 | 20,448,217 |
Loans and obligations under finance leases; less current maturities | 305,702 | 564,572 |
Operating lease obligations; less current maturities | 1,635,866 | |
Total liabilities | 22,520,042 | 21,012,789 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $.01 par value; 500,000 shares authorized; | ||
Common stock, $.01 par value; 14,500,000 shares authorized; 12,038,697 shares issued and 11,791,194 outstanding as of March 31, 2020 and 11,911,742 shares issued and 11,664,239 outstanding as of June 30, 2019 | 120,387 | 119,117 |
Additional paid-in-capital | 128,374,098 | 127,737,999 |
Treasury stock (At cost, 247,503 shares and 247,503 shares as of March 31, 2020 and June 30, 2019, respectively) | (1,455,969) | (1,455,969) |
Accumulated deficit | (35,448,063) | (35,206,898) |
Other comprehensive loss | (34,065,385) | (33,125,006) |
Total NetSol stockholders' equity | 57,525,068 | 58,069,243 |
Non-controlling interest | 6,361,553 | 8,414,987 |
Total stockholders' equity | 63,886,621 | 66,484,230 |
Total liabilities and stockholders' equity | $ 86,406,663 | $ 87,497,019 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance | $ 364,383 | $ 192,786 |
Accounts receivable related party, allowance | 54,307 | 166,075 |
Revenues in excess of billings, allowance | $ 190,811 | $ 194,684 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 500,000 | 500,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 14,500,000 | 14,500,000 |
Common stock, shares issued | 12,038,697 | 11,911,742 |
Common stock, shares outstanding | 11,791,194 | 11,664,239 |
Treasury stock, shares | 247,503 | 247,503 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Net Revenues: | ||||
Total net revenues | $ 13,530,837 | $ 17,127,055 | $ 42,793,272 | $ 50,526,227 |
Cost of revenues: | ||||
Salaries and consultants | 4,850,438 | 4,833,611 | 13,931,274 | 14,351,227 |
Travel | 1,052,033 | 1,793,964 | 3,967,591 | 4,652,143 |
Depreciation and amortization | 737,637 | 874,654 | 2,191,654 | 2,692,306 |
Other | 868,491 | 1,067,506 | 2,767,927 | 3,176,602 |
Total cost of revenues | 7,508,599 | 8,569,735 | 22,858,446 | 24,872,278 |
Gross profit | 6,022,238 | 8,557,320 | 19,934,826 | 25,653,949 |
Operating expenses: | ||||
Selling and marketing | 1,587,821 | 1,864,990 | 5,189,785 | 5,614,619 |
Depreciation and amortization | 206,035 | 252,442 | 623,901 | 658,453 |
General and administrative | 4,151,394 | 3,833,209 | 12,638,797 | 12,241,988 |
Research and development cost | 453,050 | 513,770 | 1,580,625 | 1,256,577 |
Total operating expenses | 6,398,300 | 6,464,411 | 20,033,108 | 19,771,637 |
Income (loss) from operations | (376,062) | 2,092,909 | (98,282) | 5,882,312 |
Other income and (expenses) | ||||
Gain (loss) on sale of assets | 129 | 16,380 | 368 | 65,170 |
Interest expense | (94,395) | (70,447) | (246,064) | (233,685) |
Interest income | 448,368 | 201,084 | 1,283,279 | 680,469 |
Gain (loss) on foreign currency exchange transactions | 1,770,894 | 47,218 | 71,765 | 2,594,885 |
Share of net loss from equity investment | (78,502) | (245,389) | (432,522) | (843,373) |
Other income | 17,012 | 3,116 | 243,325 | 12,998 |
Total other income (expenses) | 2,063,506 | (48,038) | 920,151 | 2,276,464 |
Net income before income taxes | 1,687,444 | 2,044,871 | 821,869 | 8,158,776 |
Income tax provision | (218,351) | (275,476) | (1,067,099) | (777,262) |
Net income (loss) | 1,469,093 | 1,769,395 | (245,230) | 7,381,514 |
Non-controlling interest | (468,286) | (501,835) | 4,065 | (2,295,736) |
Net income (loss) attributable to NetSol | $ 1,000,807 | $ 1,267,560 | $ (241,165) | $ 5,085,778 |
Net income (loss) per share: | ||||
Net income (loss) per common share - Basic | $ 0.09 | $ 0.11 | $ (0.02) | $ 0.44 |
Net income (loss) per common share - Diluted | $ 0.09 | $ 0.11 | $ (0.02) | $ 0.44 |
Weighted average number of shares outstanding | ||||
Basic | 11,753,063 | 11,656,098 | 11,713,827 | 11,580,066 |
Diluted | 11,753,063 | 11,691,342 | 11,713,827 | 11,615,310 |
License Fees [Member] | ||||
Net Revenues: | ||||
Total net revenues | $ 312,133 | $ 2,536,320 | $ 3,375,241 | $ 13,310,002 |
Maintenance Fees [Member] | ||||
Net Revenues: | ||||
Total net revenues | 4,934,635 | 3,704,756 | 14,291,959 | 11,106,155 |
Services [Member] | ||||
Net Revenues: | ||||
Total net revenues | 8,222,227 | 10,728,983 | 24,923,873 | 25,548,451 |
Services - Related Party [Member] | ||||
Net Revenues: | ||||
Total net revenues | $ 61,842 | $ 156,996 | $ 202,199 | $ 561,619 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 1,000,807 | $ 1,267,560 | $ (241,165) | $ 5,085,778 |
Other comprehensive income (loss): | ||||
Translation adjustment | (4,605,609) | (128,387) | (1,108,848) | (6,376,953) |
Translation adjustment attributable to non-controlling interest | 996,856 | 100,366 | 168,469 | 2,288,192 |
Net translation adjustment | (3,608,753) | (28,021) | (940,379) | (4,088,761) |
Comprehensive income (loss) attributable to NetSol | $ (2,607,946) | $ 1,239,539 | $ (1,181,544) | $ 997,017 |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Stockholders' Equity (Unaudited) - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Shares [Member] | Accumulated Deficit [Member] | Stock Subscriptions Receivable [Member] | Other Comprehensive Loss [Member] | Non Controlling Interest [Member] | Total |
Balance at Jun. 30, 2018 | $ 117,085 | $ 126,479,147 | $ (1,205,024) | $ (37,994,502) | $ (221,000) | $ (24,386,071) | $ 14,146,417 | $ 76,936,052 |
Balance, shares at Jun. 30, 2018 | 11,708,469 | |||||||
Adjustment in retained earnings on adoption of ASC 606 | (5,795,795) | (2,957,860) | (8,753,655) | |||||
Exercise of subsidiary common stock options | (6,629) | 9,279 | 2,650 | |||||
Common stock issued for: Services | $ 739 | 445,801 | 446,540 | |||||
Common stock issued for: Services, shares | 73,891 | |||||||
Foreign currency translation adjustment | (263,203) | (200,873) | (464,076) | |||||
Net income (loss) | 962,589 | 318,546 | 1,281,135 | |||||
Balance at Sep. 30, 2018 | $ 117,824 | 126,918,319 | (1,205,024) | (42,827,708) | (221,000) | (24,649,274) | 11,315,509 | 69,448,646 |
Balance, shares at Sep. 30, 2018 | 11,782,360 | |||||||
Balance at Jun. 30, 2018 | $ 117,085 | 126,479,147 | (1,205,024) | (37,994,502) | (221,000) | (24,386,071) | 14,146,417 | 76,936,052 |
Balance, shares at Jun. 30, 2018 | 11,708,469 | |||||||
Foreign currency translation adjustment | (6,376,953) | |||||||
Net income (loss) | 7,381,514 | |||||||
Balance at Mar. 31, 2019 | $ 118,791 | 127,551,606 | (1,205,024) | (38,704,519) | (221,000) | (28,474,832) | 10,638,915 | 69,703,937 |
Balance, shares at Mar. 31, 2019 | 11,879,056 | |||||||
Balance at Sep. 30, 2018 | $ 117,824 | 126,918,319 | (1,205,024) | (42,827,708) | (221,000) | (24,649,274) | 11,315,509 | 69,448,646 |
Balance, shares at Sep. 30, 2018 | 11,782,360 | |||||||
Exercise of common stock options | $ 100 | 64,900 | 65,000 | |||||
Exercise of common stock options, shares | 10,000 | |||||||
Common stock issued for: Services | $ 679 | 415,519 | 416,198 | |||||
Common stock issued for: Services, shares | 67,950 | |||||||
Dividend to non-controlling interest | (566,465) | (566,465) | ||||||
Foreign currency translation adjustment | (3,797,537) | (1,986,953) | (5,784,490) | |||||
Net income (loss) | 2,855,629 | 1,475,355 | 4,330,984 | |||||
Balance at Dec. 31, 2018 | $ 118,603 | 127,398,738 | (1,205,024) | (39,972,079) | (221,000) | (28,446,811) | 10,237,446 | 67,909,873 |
Balance, shares at Dec. 31, 2018 | 11,860,310 | |||||||
Exercise of common stock options | $ 31 | 19,969 | 20,000 | |||||
Exercise of common stock options, shares | 3,076 | |||||||
Common stock issued for: Services | $ 157 | 89,287 | 89,444 | |||||
Common stock issued for: Services, shares | 15,670 | |||||||
Foreign currency translation adjustment | (28,021) | (100,366) | (128,387) | |||||
Fair value of options extended | 43,612 | 43,612 | ||||||
Net income (loss) | 1,267,560 | 501,835 | 1,769,395 | |||||
Balance at Mar. 31, 2019 | $ 118,791 | 127,551,606 | (1,205,024) | (38,704,519) | $ (221,000) | (28,474,832) | 10,638,915 | 69,703,937 |
Balance, shares at Mar. 31, 2019 | 11,879,056 | |||||||
Balance at Jun. 30, 2019 | $ 119,117 | 127,737,999 | (1,455,969) | (35,206,898) | (33,125,006) | 8,414,987 | 66,484,230 | |
Balance, shares at Jun. 30, 2019 | 11,911,742 | |||||||
Exercise of subsidiary common stock options | (28,097) | 39,718 | 11,621 | |||||
Common stock issued for: Services | $ 604 | 342,177 | 342,781 | |||||
Common stock issued for: Services, shares | 60,367 | |||||||
Foreign currency translation adjustment | 903,345 | 584,356 | 1,487,701 | |||||
Net income (loss) | (1,827,947) | (433,312) | (2,261,259) | |||||
Balance at Sep. 30, 2019 | $ 119,721 | 128,052,079 | (1,455,969) | (37,034,845) | (32,221,661) | 8,605,749 | 66,065,074 | |
Balance, shares at Sep. 30, 2019 | 11,972,109 | |||||||
Balance at Jun. 30, 2019 | $ 119,117 | 127,737,999 | (1,455,969) | (35,206,898) | (33,125,006) | 8,414,987 | $ 66,484,230 | |
Balance, shares at Jun. 30, 2019 | 11,911,742 | |||||||
Exercise of common stock options, shares | ||||||||
Foreign currency translation adjustment | $ (1,108,848) | |||||||
Net income (loss) | (245,230) | |||||||
Balance at Mar. 31, 2020 | $ 120,387 | 128,374,098 | (1,455,969) | (35,448,063) | (34,065,385) | 6,361,553 | 63,886,621 | |
Balance, shares at Mar. 31, 2020 | 12,038,697 | |||||||
Balance at Sep. 30, 2019 | $ 119,721 | 128,052,079 | (1,455,969) | (37,034,845) | (32,221,661) | 8,605,749 | 66,065,074 | |
Balance, shares at Sep. 30, 2019 | 11,972,109 | |||||||
Common stock issued for: Services | $ 285 | 145,510 | 145,795 | |||||
Common stock issued for: Services, shares | 28,457 | |||||||
Dividend to non-controlling interest | (1,920,618) | (1,920,618) | ||||||
Foreign currency translation adjustment | 1,765,029 | 244,031 | 2,009,060 | |||||
Net income (loss) | 585,975 | (39,039) | 546,936 | |||||
Balance at Dec. 31, 2019 | $ 120,006 | 128,197,589 | (1,455,969) | (36,448,870) | (30,456,632) | 6,890,123 | 66,846,247 | |
Balance, shares at Dec. 31, 2019 | 12,000,566 | |||||||
Common stock issued for: Services | $ 381 | 176,509 | 176,890 | |||||
Common stock issued for: Services, shares | 38,131 | |||||||
Foreign currency translation adjustment | (3,608,753) | (996,856) | (4,605,609) | |||||
Net income (loss) | 1,000,807 | 468,286 | 1,469,093 | |||||
Balance at Mar. 31, 2020 | $ 120,387 | $ 128,374,098 | $ (1,455,969) | $ (35,448,063) | $ (34,065,385) | $ 6,361,553 | $ 63,886,621 | |
Balance, shares at Mar. 31, 2020 | 12,038,697 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net income (loss) | $ (245,230) | $ 7,381,514 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 2,815,555 | 3,350,759 |
Provision for bad debts | 75,437 | |
Share of net loss from investment under equity method | 432,522 | 843,373 |
Gain on sale of assets | (368) | (65,170) |
Stock based compensation | 565,287 | 980,682 |
Fair market value of stock options | 43,612 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (651,991) | (4,249,540) |
Accounts receivable - related party | 1,979,232 | (461,435) |
Revenues in excess of billing | (1,394,184) | (6,862,451) |
Revenues in excess of billing - related party | 106,592 | (97,359) |
Other current assets | (824,068) | (1,189,909) |
Accounts payable and accrued expenses | 63,289 | (540,615) |
Unearned revenue | (2,510,954) | 611,157 |
Net cash provided by (used in) operating activities | 411,119 | (255,382) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (1,011,285) | (2,590,302) |
Sales of property and equipment | 33,820 | 1,005,214 |
Convertible note receivable - related party | (600,000) | (1,126,500) |
Net cash used in investing activities | (1,577,465) | (2,711,588) |
Cash flows from financing activities: | ||
Proceeds from the exercise of stock options and warrants | 85,000 | |
Proceeds from exercise of subsidiary options | 11,621 | 2,650 |
Dividend paid by subsidiary to non-controlling interest | (1,920,618) | (566,465) |
Proceeds from bank loans | 2,312,968 | 1,337,092 |
Payments on finance lease obligations and loans - net | (422,051) | (298,610) |
Net cash provided by (used in) financing activities | (18,080) | 559,667 |
Effect of exchange rate changes | (438,610) | (2,666,960) |
Net decrease in cash and cash equivalents | (1,623,036) | (5,074,263) |
Cash and cash equivalents at beginning of the period | 17,366,364 | 22,088,853 |
Cash and cash equivalents at end of period | 15,743,328 | 17,014,590 |
SUPPLEMENTAL DISCLOSURES: | ||
Interest | 220,041 | 256,528 |
Taxes | 1,112,179 | 673,712 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Assets acquired under finance lease | 66,256 | |
Assets recognized under operating lease | $ 3,474,583 |
Basis of Presentation and Princ
Basis of Presentation and Principles of Consolidation | 9 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Principles of Consolidation | NOTE 1 - BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION The Company designs, develops, markets, and exports proprietary software products to customers in the automobile financing and leasing, banking, and financial services industries worldwide. The Company also provides system integration, consulting, and IT products and services in exchange for fees from customers. The consolidated condensed interim financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. These statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary for fair presentation of the information contained therein. It is suggested that these condensed consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended June 30, 2019. The Company follows the same accounting policies in preparation of interim reports. Results of operations for the interim periods are not indicative of annual results. The accompanying condensed consolidated financial statements include the accounts of NetSol Technologies, Inc. and subsidiaries (collectively, the “Company”) as follows: Wholly owned Subsidiaries NetSol Technologies Americas, Inc. (“NTA”) OTOZ, Inc. (“OTOZ”) NetSol Connect (Private), Ltd. (“Connect”) NetSol Technologies Australia Pty Ltd. (“Australia”) NetSol Technologies Europe Limited (“NTE”) NTPK (Thailand) Co. Limited (“NTPK Thailand”) NetSol Technologies (Beijing) Co. Ltd. (“NetSol Beijing”) Ascent Europe Ltd. (“AEL”) Virtual Lease Services Holdings Limited (“VLSH”) Virtual Lease Services Limited (“VLS”) Virtual Lease Services (Ireland) Limited (“VLSIL”) Majority-owned Subsidiaries NetSol Technologies, Ltd. (“NetSol PK”) NetSol Innovation (Private) Limited (“NetSol Innovation”) NetSol Technologies Thailand Limited (“NetSol Thai”) For comparative purposes, prior year’s condensed consolidated financial statements have been reclassified to conform to report classifications of the current period. Below is the table of reclassified amounts: For the Three Months Ended For the Nine Months Ended March 31, 2019 March 31, 2019 Originally reported Reclassified Originally reported Reclassified REVENUES License fees $ 2,536,320 $ 2,536,320 $ 13,310,002 $ 13,310,002 Maintenance fees 3,562,412 3,704,756 10,735,432 11,106,155 Services 10,519,219 10,728,983 25,175,187 25,548,451 Maintenance fees - related party 142,344 - 370,723 - Services - related party 366,760 156,996 934,883 561,619 Total net revenues $ 17,127,055 $ 17,127,055 $ 50,526,227 $ 50,526,227 |
Accounting Policies
Accounting Policies | 9 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Accounting Policies | NOTE 2 – ACCOUNTING POLICIES Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The areas requiring significant estimates are provision for doubtful accounts, provision for taxation, useful life of depreciable assets, useful life of intangible assets, contingencies, assumptions used to determine the net present value of operating lease liabilities, and estimated contract costs. The estimates and underlying assumptions are reviewed on an ongoing basis. Actual results could differ from those estimates. Concentration of Credit Risk Cash includes cash on hand and demand deposits in accounts maintained within the United States as well as in foreign countries. Certain financial instruments, which subject the Company to concentration of credit risk, consist of cash and restricted cash. The Company maintains balances at financial institutions which, from time to time, may exceed Federal Deposit Insurance Corporation insured limits for the banks located in the United States. Balances at financial institutions within certain foreign countries are not covered by insurance. As of March 31, 2020, and June 30, 2019, the Company had uninsured deposits related to cash deposits in accounts maintained within foreign entities of approximately $14,677,110 and $16,124,339, respectively. The Company has not experienced any losses in such accounts. The Company’s operations are carried out globally. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environments of each country and by the general state of the country’s economy. The Company’s operations in each foreign country are subject to specific considerations and significant risks not typically associated with companies in economically developed nations. These include risks associated with, among others, the political, economic and legal environments and foreign currency exchange. The Company’s results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. Fair Value of Financial Instruments The Company applies the provisions of Accounting Standards Codification (“ASC”) 820-10, “Fair Value Measurements and Disclosures.” The three levels of valuation hierarchy are defined as follows: Level 1: Valuations consist of unadjusted quoted prices in active markets for identical assets and liabilities and has the highest priority. Level 2: Valuations rely on quoted prices in markets that are not active or observable inputs over the full term of the asset or liability. Level 3: Valuations are based on prices or third party or internal valuation models that require inputs that are significant to the fair value measurement and are less observable and thus have the lowest priority. The Company’s assets that were measured at fair value on a recurring basis as of March 31, 2020, were as follows: Level 1 Level 2 Level 3 Total Assets Revenues in excess of billings - long term $ - $ - $ 1,282,898 $ 1,282,898 Total $ - $ - $ 1,282,898 $ 1,282,898 The Company’s financial assets that were measured at fair value on a recurring basis as of June 30, 2019, were as follows: Level 1 Level 2 Level 3 Total Assets Revenues in excess of billings - long term $ - $ - $ 1,281,492 $ 1,281,492 Total $ - $ - $ 1,281,492 $ 1,281,492 The reconciliation from June 30, 2019 to March 31, 2020 is as follows: Revenues in excess Fair value discount Total Balance at June 30, 2018 $ 1,445,245 $ (238,576 ) $ 1,206,669 Effect of ASC 606 adoption (1,445,245 ) 238,576 (1,206,669 ) Additions 1,380,631 (99,139 ) 1,281,492 Balance at June 30, 2019 $ 1,380,631 $ (99,139 ) $ 1,281,492 Amortization during the period - 41,621 41,621 Effect of Translation Adjustment (42,840 ) 2,625 (40,215 ) Balance at March 31, 2020 $ 1,337,791 $ (54,893 ) $ 1,282,898 Management analyzes all financial instruments with features of both liabilities and equity under ASC 480, “Distinguishing Liabilities from Equity” “Derivatives and Hedging.” New Accounting Pronouncements Recent Accounting Standards Adopted by the Company: In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842). This pronouncement requires lessees to recognize a liability for lease obligations, which represents the discounted obligation to make future lease payments, and a corresponding right-of-use (“ROU”) asset on the balance sheet. The Company adopted ASU 2016-02, along with related clarifications and improvements, as of July 1, 2019, using the modified retrospective approach, which allows the Company to apply ASC 840, Leases, in the comparative periods presented in the year of adoption. Accordingly, the comparative periods and disclosures have not been restated. The Company elected the package of practical expedients to not reassess: ● whether a contract is or contains a lease ● lease classification ● initial direct costs Additionally, the Company adopted the policy election to not recognize ROU assets and lease liabilities for short-term leases for all asset classes. Adoption of the new standard resulted in the recording of a non-cash transitional adjustment to ROU assets and lease liabilities of $3,011,814 and $3,091,236, respectively, as of July 1, 2019. The difference between the ROU assets and lease liabilities represented existing deferred rent expense and prepaid rent that were derecognized and adjusted the ROU assets in the Condensed Consolidated Balance Sheets. The adoption of ASU 2016-02 did not materially impact the results of operations or cash flows. Accounting Standards Recently Issued but Not Yet Adopted by the Company: In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. All other newly issued accounting pronouncements not yet effective have been deemed either immaterial or not applicable. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Mar. 31, 2020 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Revenue Recognition | NOTE 3 – REVENUE RECOGNITION The Company determines revenue recognition through the following steps: ● Identification of the contract, or contracts, with a customer; ● Identification of the performance obligations in the contract; ● Determination of the transaction price; ● Allocation of the transaction price to the performance obligations in the contract; and ● Recognition of revenue when, or as, the Company satisfies a performance obligation. The Company records the amount of revenue and related costs by considering whether the entity is a principal (gross presentation) or an agent (net presentation) by evaluating the nature of its promise to the customer. Revenue is presented net of sales, value-added and other taxes collected from customers and remitted to government authorities. The Company has two primary revenue streams: core revenue and non-core revenue. Core Revenue The Company generates its core revenue from the following sources: (1) software licenses, (2) services, which include implementation and consulting services, and (3) maintenance, which includes post contract support, of its enterprise software solutions for the lease and finance industry. The Company offers its software using the same underlying technology via two models: a traditional on-premises licensing model and a subscription model. The on-premises model involves the sale or license of software on a perpetual basis to customers who take possession of the software and install and maintain the software on their own hardware. Under the subscription delivery model, the Company provides access to its software on a hosted basis as a service and customers generally do not have the contractual right to take possession of the software. Non-Core Revenue The Company generates its non-core revenue by providing business process outsourcing (“BPO”), other IT services and internet services. Performance Obligations A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account under Topic 606. The transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied by transferring the promised good or service to the customer. The Company identifies and tracks the performance obligations at contract inception so that the Company can monitor and account for the performance obligations over the life of the contract. The Company’s contracts which contain multiple performance obligations generally consist of the initial purchase of subscription or licenses and a professional services engagement. License purchases generally have multiple performance obligations as customers purchase maintenance and services in addition to the licenses. The Company’s single performance obligation arrangements are typically maintenance renewals, subscription renewals and services engagements. For contracts with multiple performance obligations where the contracted price differs from the standalone selling price (“SSP”) for any distinct good or service, the Company may be required to allocate the contract’s transaction price to each performance obligation using its best estimate for the SSP. Subscription Subscription revenue is recognized ratably over the initial subscription period committed to by the customer commencing when the product is made available to the customer. The initial subscription period is typically 12 to 60 months. The Company generally invoices its customers in advance in quarterly or annual installments and typical payment terms provide that customers make payment within 30 days of invoice. Software Licenses Transfer of control for software is considered to have occurred upon delivery of the product to the customer. The Company’s typical payment terms tend to vary by region, but its standard payment terms are within 30 days of invoice. Maintenance Revenue from support services and product updates, referred to as maintenance revenue, is recognized ratably over the term of the maintenance period, which in most instances is one year. Software license updates provide customers with rights to unspecified software product updates, maintenance releases and patches released during the term of the support period on a when-and-if available basis. The Company’s customers purchase both product support and license updates when they acquire new software licenses. In addition, a majority of customers renew their support services contracts annually and typical payment terms provide that customers make payment within 30 days of invoice. Professional Services Revenue from professional services is typically comprised of implementation, development, data migration, training or other consulting services. Consulting services are generally sold on a time-and-materials or fixed fee basis and can include services ranging from software installation to data conversion and building non-complex interfaces to allow the software to operate in integrated environments. The Company recognizes revenue for time-and-materials arrangements as the services are performed. In fixed fee arrangements, revenue is recognized as services are performed as measured by costs incurred to date, compared to total estimated costs to complete the services project. Management applies judgment when estimating project status and the costs necessary to complete the services projects. A number of internal and external factors can affect these estimates, including labor rates, utilization and efficiency variances and specification and testing requirement changes. Services are generally invoiced upon milestones in the contract or upon consumption of the hourly resources and payments are typically due 30 days after invoice. BPO and Internet Services Revenue from BPO services is recognized based on the stage of completion which is measured by reference to labor hours incurred to date as a percentage of total estimated labor hours for each contract. Internet services are invoiced either monthly, quarterly or half yearly in advance to the customers and revenue is recognized ratably overtime on a monthly basis. Disaggregated Revenue The Company disaggregates revenue from contracts with customers by category — core and non-core, as it believes it best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. The Company’s disaggregated revenue by category is as follows: For the Three Months For the Nine Months Ended March 31, Ended March 31, 2020 2019 2020 2019 Core: License $ 312,133 $ 2,536,320 $ 3,375,241 $ 13,310,002 Maintenance 4,934,635 3,704,756 14,291,959 11,106,155 Services 6,430,189 9,148,894 19,615,987 21,005,540 Services - related party 61,842 156,996 202,199 494,333 Total core revenue, net 11,738,799 15,546,966 37,485,386 45,916,030 Non-Core: Services 1,792,038 1,580,089 5,307,886 4,542,911 Services - related party - - - 67,286 Total non-core revenue, net 1,792,038 1,580,089 5,307,886 4,610,197 Total net revenue $ 13,530,837 $ 17,127,055 $ 42,793,272 $ 50,526,227 Significant Judgments Due to the complexity of certain contracts, the actual revenue recognition treatment required under Topic 606 for the Company’s arrangements may be dependent on contract-specific terms and may vary in some instances. Judgment is required to determine the SSP for each distinct performance obligation. The Company rarely licenses or sells products on a stand-alone basis, so the Company is required to estimate the range of SSPs for each performance obligation. In instances where SSP is not directly observable because the Company does not sell the license, product or service separately, the Company determines the SSP using information that may include market conditions and other observable inputs. In making these judgments, the Company analyzes various factors, including its pricing methodology and consistency, size of the arrangement, length of term, customer demographics and overall market and economic conditions. Based on these results, the estimated SSP is set for each distinct product or service delivered to customers. The most significant inputs involved in the Company’s revenue recognition policies are: The (1) stand-alone selling prices of the Company’s software license, and the (2) the method of recognizing revenue for installation/customization, and other services. The stand-alone selling price of the licenses was measured primarily through an analysis of pricing that management evaluated when quoting prices to customers. Although the Company has no history of selling its software separately from maintenance and other services, the Company does have historical experience with amending contracts with customers to provide additional modules of its software or providing those modules at an optional price. This information guides the Company in assessing the stand-alone selling price of the Company’s software, since the Company can observe instances where a customer had a particular component of the Company’s software that was essentially priced separate from other goods and services that the Company delivered to that customer. The Company recognized revenue from implementation and customization services using the percentage of estimated “man-days” that the work requires. The Company believes the level of effort to complete the services is best measured by the amount of time (measured as an employee working for one day on implementation/customization work) that is required to complete the implementation or customization work. The Company reviews its estimate of man-days required to complete implementation and customization services each reporting period. Revenue is recognized over time for the Company’s subscription, maintenance and fixed fee professional services that are separate performance obligations. For the Company’s professional services, revenue is recognized over time, generally using costs incurred or hours expended to measure progress. Judgment is required in estimating project status and the costs necessary to complete projects. A number of internal and external factors can affect these estimates, including labor rates, utilization, specification variances and testing requirement changes. If a group of agreements are entered at or near the same time and so closely related that they are, in effect, part of a single arrangement, such agreements are deemed to be combined as one arrangement for revenue recognition purposes. The Company exercises significant judgment to evaluate the relevant facts and circumstances in determining whether agreements should be accounted for separately or as a single arrangement. The Company’s judgments about whether a group of contracts comprise a single arrangement can affect the allocation of consideration to the distinct performance obligations, which could have an effect on results of operations for the periods involved. If a contract includes variable consideration, the Company exercises judgment in estimating the amount of consideration to which the entity will be entitled in exchange for transferring the promised goods or services to a customer. When estimating variable consideration, the Company will consider all relevant facts and circumstances. Variable consideration will be estimated and included in the contract price only when it is probable that a significant reversal in the amount of revenue recognized will not occur. Contract Balances The timing of revenue recognition may differ from the timing of invoicing to customers and these timing differences result in receivables, contract assets (revenues in excess of billings), or contract liabilities (deferred revenue) on the Company’s Consolidated Balance Sheets. The Company records revenues in excess of billings when the Company has transferred goods or services but does not yet have the right to consideration. The Company records deferred revenue when the Company has received or has the right to receive consideration but has not yet transferred goods or services to the customer. The revenues in excess of billings are transferred to receivables when the rights to consideration become unconditional, usually upon completion of a milestone. The Company’s revenues in excess of billings and deferred revenue are as follows: As of As of March 31, 2020 June 30, 2019 Revenues in excess of billings $ 16,592,293 $ 16,111,366 Deferred Revenue $ 3,440,663 $ 5,977,736 During the three and nine months ended March 31, 2020, the Company recognized revenue of $586,899 and $5,638,097, respectively, that was included in the deferred revenue balance at the beginning of the period. All other activity in deferred revenue is due to the timing of invoicing in relation to the timing of revenue recognition. Revenue allocated to remaining performance obligations represents the transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied, which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. Contracted but unsatisfied performance obligations were approximately $63,609,872 as of March 31, 2020, of which the Company estimates to recognize approximately $13,066,505 in revenue over the next 12 months and the remainder over an estimated 5 years thereafter. Actual revenue recognition depends in part on the timing of software modules installed at various customer sites. Accordingly, some factors that affect the Company’s revenue, such as the availability and demand for modules within customer geographic locations, is not entirely within the Company’s control. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined that its contracts generally do not include a significant financing component. The primary purpose of invoicing terms is to provide customers with simplified and predictable ways of purchasing the Company’s products and services, and not to facilitate financing arrangements. Deferred Revenue The Company typically invoices its customers for subscription and support fees in advance on a quarterly or annual basis, with payment due at the start of the subscription or support term. Unpaid invoice amounts for non-cancelable license and services starting in future periods are included in accounts receivable and deferred revenue. Practical Expedients and Exemptions There are several practical expedients and exemptions allowed under Topic 606 that impact timing of revenue recognition and the Company’s disclosures. Below is a list of practical expedients applied by the Company: ● The Company does not evaluate a contract for a significant financing component if payment is expected within one year or less from the transfer of the promised items to the customer. ● The Company generally expenses sales commissions and sales agent fees when incurred when the amortization period would have been one year or less or the commissions are based on cashed received. These costs are recorded within sales and marketing expense in the Consolidated Statement of Operations. ● The Company does not disclose the value of unsatisfied performance obligations for contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed (applies to time-and-material engagements). Costs to Obtain a Contract The Company does not have a material amount of costs to obtain a contract capitalized at any balance sheet date. In general, the Company incurs few direct incremental costs of obtaining new customer contracts. The Company rarely incurs incremental costs to review or otherwise enter into contractual arrangements with customers. In addition, the Company’s sales personnel receive fees that are referred to as commissions, but that are based on more than simply signing up new customers. The Company’s sales personnel are required to perform additional duties beyond new customer contract inception dates, including fulfilment duties and collections efforts. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | NOTE 4 – EARNINGS PER SHARE Basic earnings per share are computed based on the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include outstanding stock options and stock awards. The components of basic and diluted earnings per share were as follows: For the three months ended March 31, 2020 For the nine months ended March 31, 2020 Net Income Shares Per Share Net Loss Shares Per Share Basic income (loss) per share: Net income (loss) available to common shareholders $ 1,000,807 11,753,063 $ 0.09 $ (241,165 ) 11,713,827 $ (0.02 ) Effect of dilutive securities Stock options - - - - - - Share grants - - - - - - Diluted income (loss) per share $ 1,000,807 11,753,063 $ 0.09 $ (241,165 ) 11,713,827 $ (0.02 ) For the three months ended March 31, 2019 For the nine months ended March 31, 2019 Net Income Shares Per Share Net Income Shares Per Share Basic income per share: Net income available to common shareholders $ 1,267,560 11,656,098 $ 0.11 $ 5,085,778 11,580,066 $ 0.44 Effect of dilutive securities Stock options - 4,948 - - 5,686 - Share grants - 30,296 - - - - Diluted income per share $ 1,267,560 11,691,342 $ 0.11 $ 5,085,778 11,585,752 $ 0.44 The following potential dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive. For the Three Months For the Nine Months Ended March 31, Ended March 31, 2020 2019 2020 2019 Share Grants 101,790 - 101,790 - 101,790 - 101,790 - |
Other Comprehensive Income and
Other Comprehensive Income and Foreign Currency | 9 Months Ended |
Mar. 31, 2020 | |
VLSVLHS And VLSIL Combined [Member] | |
Other Comprehensive Income and Foreign Currency | NOTE 5 – OTHER COMPREHENSIVE INCOME AND FOREIGN CURRENCY The accounts of NTE, AEL, VLSH and VLS use the British Pound; VLSIL uses the Euro; NetSol PK, Connect, and NetSol Innovation use the Pakistan Rupee; NTPK Thailand and NetSol Thai use the Thai Baht; Australia uses the Australian dollar; and NetSol Beijing uses the Chinese Yuan as the functional currencies. NetSol Technologies, Inc., and its subsidiary, NTA, use the U.S. dollar as the functional currency. Assets and liabilities are translated at the exchange rate on the balance sheet date, and operating results are translated at the average exchange rate throughout the period. Accumulated translation losses classified as an item of accumulated other comprehensive loss in the stockholders’ equity section of the consolidated balance sheet were $34,065,385 and $33,125,006 as of March 31, 2020 and June 30, 2019, respectively. During the three and nine months ended March 31, 2020, comprehensive income (loss) in the consolidated statements of comprehensive income (loss) included a translation loss attributable to NetSol of $3,608,753 and $940,379, respectively. During the three and nine months ended March 31, 2019, comprehensive income (loss) in the consolidated statements of comprehensive income (loss) included a translation loss attributable to NetSol of $28,021 and $4,088,761, respectively. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 6 – RELATED PARTY TRANSACTIONS NetSol-Innovation In November 2004, the Company entered into a joint venture with 1insurer, formerly Innovation Group, |
Major Customers
Major Customers | 9 Months Ended |
Mar. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
Major Customers | NOTE 7 – MAJOR CUSTOMERS During the nine months ended March 31, 2020, revenues from Daimler Financial Services (“DFS”) and BMW Financial (“BMW”) were $11,906,959 and $6,893,438, respectively representing 27.8% and 16.1%, respectively of revenues. During the nine months ended March 31, 2019, revenues from DFS and BMW were $17,137,545 and $10,339,704, respectively representing 33.9% and 20.5%, respectively of revenues. The revenue from these customers are shown in the Asia – Pacific segment. Accounts receivable from DFS and BMW at March 31, 2020, were $5,186,256 and $3,271,459, respectively. Accounts receivable at June 30, 2019, were $7,917,814 and $159,322, respectively. Revenues in excess of billings at March 31, 2020 were $5,982,097 and $5,365,137, respectively. Revenues in excess of billings at June 30, 2019, were $4,371,081 and $5,472,043, respectively. Included in this amount was $1,282,898 and $1,281,492 shown as long term at March 31, 2020 and June 30, 2019, respectively. |
Convertible Note Receivable - R
Convertible Note Receivable - Related Party | 9 Months Ended |
Mar. 31, 2020 | |
Receivables [Abstract] | |
Convertible Note Receivable - Related Party | NOTE 8 – CONVERTIBLE NOTE RECEIVABLE – RELATED PARTY The Company entered into an agreement with WRLD3D, whereby the Company was issued a Convertible Promissory Note (the “August 2019 Note”) which was fully executed on August 19, 2019. The maximum principal amount of $400,000 was paid on September 9, 2019. The August 2019 Note bears interest at 10% per annum and all unpaid interest and principal is due and payable upon request on or after March 31, 2020. The Company has a security interest in all of WRLD3D’s personal property, inventory, equipment, general intangibles, financial assets, investment property, securities, deposit accounts, and the proceeds thereof. The August 2019 Note is convertible upon the occurrence of the following events: 1. Conversion upon a qualified financing which is an equity financing of at least $1,000,000. 2. Optional conversion upon an equity financing less than $1,000,000. 3. Optional conversion after the maturity date. 4. Change of control. If the Company converts the August 2019 Note upon the occurrence of a financing, then the conversion price will be equal to the product of: (A) the price paid per share for the equity securities by the investors multiplied by (B) a calculated conversion rate which is determined based on the amount of the principal and interest outstanding and the Company’s ownership percentage. If the Company converts the August 2019 Note either as an optional conversion after the maturity date or due to a change of control, then the conversion price is equal to $0.6788 per share (adjusted for any stock dividends, combinations, splits, recapitalizations or the like with respect to WRLD3D’s Series BB Preferred Stock after the date of the August 2019 Note). The following table summarizes the convertible notes receivable from WRLD3D. Convertible Agreement Interest Maturity Note Date Rate Date Amount May 25, 2017 5 % On Demand $ 750,000 February 9, 2018 10 % On Demand 2,500,000 April 1, 2019 10 % March 31, 2020 600,000 August 19, 2019 10 % March 31, 2020 400,000 $ 4,250,000 The Company has accrued interest of $604,452 and $328,748 at March 31, 2020 and June 30, 2019, respectively, which is included in “Other current assets. |
Other Current Assets
Other Current Assets | 9 Months Ended |
Mar. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Other Current Assets | NOTE 9 - OTHER CURRENT ASSETS Other current assets consisted of the following: As of As of March 31, 2020 June 30, 2019 Prepaid Expenses $ 968,504 $ 991,528 Advance Income Tax 482,518 800,798 Employee Advances 125,653 33,778 Security Deposits 282,596 147,668 Other Receivables 1,534,222 733,826 Other Assets 199,872 438,666 Total $ 3,593,365 $ 3,146,264 |
Revenues in Excess of Billings
Revenues in Excess of Billings - Long Term | 9 Months Ended |
Mar. 31, 2020 | |
Contractors [Abstract] | |
Revenues in Excess of Billings - Long Term | NOTE 10 – REVENUES IN EXCESS OF BILLINGS – LONG TERM Revenues in excess of billings, net consisted of the following: As of As of March 31, 2020 June 30, 2019 Revenues in excess of billings - long term $ 1,337,791 $ 1,380,631 Present value discount (54,893 ) (99,139 ) Net Balance $ 1,282,898 $ 1,281,492 Pursuant to revenue recognition for contract accounting, the Company had recorded revenues in excess of billings long-term for amounts billable after one year. During the three and nine months ended March 31, 2020, the Company accreted $13,940 and $41,621 which was recorded in interest income for that period. The Company used the discounted cash flow method with an interest rate of 4.35%. |
Property and Equipment
Property and Equipment | 9 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | NOTE 11 - PROPERTY AND EQUIPMENT Property and equipment consisted of the following: As of As of March 31, 2020 June 30, 2019 Office Furniture and Equipment $ 3,132,869 $ 3,125,382 Computer Equipment 19,077,749 18,905,603 Assets Under Capital Leases 1,553,868 1,720,490 Building 5,905,714 6,021,939 Land 1,528,091 1,559,111 Capital Work In Progress 12,899 - Autos 1,301,193 1,024,754 Improvements 87,609 111,165 Subtotal 32,599,992 32,468,444 Accumulated Depreciation (21,046,178 ) (20,371,589 ) Property and Equipment, Net $ 11,553,814 $ 12,096,855 For the three and nine months ended March 31, 2020, depreciation expense totaled $479,350 and $1,429,463, respectively. Of these amounts, $273,315 and $805,562, respectively, are reflected in cost of revenues. For the three and nine months ended March 31, 2019, depreciation expense totaled $606,641 and $1,704,606, respectively. Of these amounts, $354,199 and $1,046,153, respectively, are reflected in cost of revenues. Following is a summary of fixed assets held under finance leases as of March 31, 2020 and June 30, 2019: As of As of March 31, 2020 June 30, 2019 Computers and Other Equipment $ 328,998 $ 324,466 Furniture and Fixtures 51,119 65,084 Vehicles 1,173,751 1,330,940 Total 1,553,868 1,720,490 Less: Accumulated Depreciation - Net (652,372 ) (538,564 ) $ 901,496 $ 1,181,926 Finance lease term and discount rate were as follows: As of March 31, 2020 Weighted average remaining lease term - Finance leases 1.65 Years Weighted average discount rate - Finance leases 13.0 % |
Leases
Leases | 9 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | NOTE 12 - LEASES The Company leases certain office space, office equipment and autos with remaining lease terms of one year to 10 years under leases classified as financing and operating. For certain leases, the Company has options to extend the lease term for additional periods ranging from one year to 10 years. The Company treats a contract as a lease when the contract conveys the right to use a physically distinct asset for a period of time in exchange for consideration, or the Company directs the use of the asset and obtains substantially all the economic benefits of the asset. These leases are recorded as right-of-use (“ROU”) assets and lease obligation liabilities for leases with terms greater than 12 months. ROU assets represent the Company’s right to use an underlying asset for the entirety of the lease term. Lease liabilities represent the Company’s obligation to make payments over the life of the lease. A ROU asset and a lease liability are recognized at commencement of the lease based on the present value of the lease payments over the life of the lease. Initial direct costs are included as part of the ROU asset upon commencement of the lease. Since the interest rate implicit in a lease is generally not readily determinable for the operating leases, the Company uses an incremental borrowing rate to determine the present value of the lease payments. The incremental borrowing rate represents the rate of interest the Company would have to pay to borrow on a collateralized basis over a similar lease term to obtain an asset of similar value. The Company used the incremental borrowing rate on July 1, 2019 for all leases that commenced prior to that date. For finance leases, the Company used the incremental borrowing rate implicit in the lease. The Company reviews the impairment of ROU assets consistent with the approach applied for the Company’s other long-lived assets. The Company reviews the recoverability of long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on the Company’s ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash flows of the related operations. The Company elected the practical expedient to exclude short-term leases (leases with original terms of 12 months or less) from ROU asset and lease liability accounts. Lease expense is recognized on a straight-line basis over the lease term, while variable lease payments are expensed as incurred. Variable payments change due to facts or circumstances occurring after the commencement date, other than the passage of time, and do not result in a re-measurement of lease liabilities. The Company’s variable lease payments include payments for finance leases that are adjusted based on a change in the Karachi Inter Bank Offer Rate. The Company’s lease agreements do not contain any significant residual value guarantees or restrictive covenants. Supplemental balance sheet information related to leases was as follows: As of March 31, 2020 Assets Operating lease assets, net $ 2,690,777 Liabilities Current Operating $ 1,146,696 Non-current Operating 1,635,866 Total Lease Liabilities $ 2,782,562 The components of lease cost were as follows: For the Nine Months Ended March 31, 2020 Amortization of finance lease assets $ 194,632 Interest on finance lease obligation 71,416 Operating lease cost 931,955 Short term lease cost 228,869 Sub lease income (25,227 ) Total lease cost $ 1,401,645 Lease term and discount rate were as follows: As of March 31, 2020 Weighted average remaining lease term - Operating leases 2.66 Years Weighted average discount rate - Operating leases 5.6 % Supplemental disclosures of cash flow information related to leases were as follows: For the Nine Months Ended March 31, 2020 Cash flows related to lease liabilities Operating cash flows related to operating leases $ 905,076 Maturities of operating lease liabilities were as follows as of March 31, 2020: Amount Within year 1 $ 1,267,595 Within year 2 958,385 Within year 3 604,275 Within year 4 132,663 Within year 5 32,001 Thereafter 3,372 Total Lease Payments 2,998,291 Less: Imputed interest (215,729 ) Present Value of lease liabilities 2,782,562 Less: Current portion (1,146,696 ) Non-Current portion $ 1,635,866 As of June 30, 2019, future minimum lease payments, as defined under the previous lease accounting guidance of ASC Topic 840, under non-cancelable operating leases for the following five fiscal years and thereafter were as follows: Within year 1 $ 744,549 Within year 2 514,243 Within year 3 269,375 Within year 4 197,872 Within year 5 36,044 Total $ 1,762,083 The Company is a lessor for certain office space leased by the Company and sub-leased to others under non-cancelable leases. These lease agreements provide for a fixed base rent and terminate by July 2021. All leases are considered operating leases. There are no rights to purchase the premises and no residual value guarantees. For the three and nine months ended March 31, 2020, the Company received $8,514 and $25,227 of lease income. |
Long Term Investment
Long Term Investment | 9 Months Ended |
Mar. 31, 2020 | |
Investments, All Other Investments [Abstract] | |
Long Term Investment | NOTE 13 – LONG TERM INVESTMENT Drivemate The Company and Drivemate Co., Ltd. (“Drivemate”) entered into a subscription agreement (“Drivemate Agreement”) whereby the Company will purchase an equity interest of 30% in Drivemate. Per the Drivemate Agreement, the Company will purchase 5,469 preferred shares for $1,800,000 consisting of $500,000 cash and $1,300,000 in services. The Company paid $250,000 on May 2, 2019 and received 760 shares for a 5.27% holding in Drivemate. The remaining $250,000 will be paid in $62,500 increments beginning 15 months from the date of the Drivemate Agreement signing with the final payment due 24 months from the date of the Drivemate Agreement signing. Per the Drivemate Agreement, the Company appointed two directors to the Drivemate board. The Company determined that it met the significant influence criteria since two of the four directors are appointed by the Company and the Company is to own 30% of Drivemate at the final payment date; therefore, the Company accounts for the investment using the equity method of accounting. During the three and nine months ended March 31, 2020, the Company performed $355,051 and $862,767 of services, respectively. Under the equity method of accounting, the Company recorded its share of net loss of $5,667 and $16,915 for the three and nine months ended March 31, 2020, respectively. WRLD3D-Related Party On March 2, 2017, the Company purchased a 4.9% interest in WRLD3D, a non-public company, for $1,111,111. The Company paid $555,556 at the initial closing and $555,555 on September 1, 2017. NetSol PK, the subsidiary of the Company, purchased a 12.2% investment in WRLD3D, for $2,777,778 which was earned by providing IT and enterprise software solutions. During the three and nine months ended March 31, 2020, NetSol PK provided services valued at $61,842 and $202,199, respectively, which is recorded as services-related party. During the three months and nine months ended March 31, 2019, NetSol PK provided services valued at $156,996 and $494,333, respectively, which is recorded as services-related party. Accounts receivable at March 31, 2020 and June 30, 2019 were $1,332,575 and $1,020,589, respectively. Revenue in excess of billings at March 31, 2020 and June 30, 2019 were $8,245 and $110,827, respectively. Under the equity method of accounting, the Company recorded its share of net loss of $72,835 and $415,607 for the three and nine months ended March 31, 2020, respectively, and the Company recorded its share of net loss of $245,389 and $843,373 for the three and nine months ended March 31, 2019, respectively. The following table reflects the above investments at March 31, 2020. Drivemate WRLD3D Total Initial investment $ 250,000 $ 3,888,889 $ 4,138,889 Cumulative net loss on investment (19,015 ) (1,351,413 ) (1,370,428 ) Cumulative Other comprehensive income (loss) - (438,755 ) (438,755 ) Net Investment $ 230,985 $ 2,098,721 $ 2,329,706 |
Intangible Assets
Intangible Assets | 9 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | NOTE 14 - INTANGIBLE ASSETS Intangible assets consisted of the following: As of As of March 31, 2020 June 30, 2019 Product Licenses - Cost $ 47,244,997 $ 47,244,997 Effect of Translation Adjustment (15,833,112 ) (15,343,727 ) Accumulated Amortization (25,531,126 ) (24,568,320 ) Net Balance $ 5,880,759 $ 7,332,950 (A) Product Licenses Product licenses include internally developed original license issues, renewals, enhancements, copyrights, trademarks, and trade names. Product licenses are amortized on a straight-line basis over their respective lives, and the unamortized amount of $5,880,759 will be amortized over the next 3.5 years. Amortization expense for the three and nine months ended March 31, 2020 was $464,322 and $1,386,092, respectively. Amortization expense for the three and nine months ended March 31, 2019 was $520,455 and $1,646,153, respectively. (B) Future Amortization Estimated amortization expense of intangible assets over the next five years is as follows: Year ended: March 31, 2021 $ 1,748,286 March 31, 2022 1,748,286 March 31, 2023 1,748,286 March 31, 2024 635,901 $ 5,880,759 |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 9 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | NOTE 15 - ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consisted of the following: As of As of March 31, 2020 June 30, 2019 Accounts Payable $ 1,711,503 $ 1,156,498 Accrued Liabilities 4,478,601 5,055,358 Accrued Payroll & Taxes 553,223 793,503 Taxes Payable 196,376 326,386 Other Payable 168,230 144,815 Total $ 7,107,933 $ 7,476,560 |
Debts
Debts | 9 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debts | NOTE 16 – DEBTS Notes payable and finance leases consisted of the following: As of March 31, 2020 Current Long-Term Name Total Maturities Maturities D&O Insurance (1 ) $ 164,731 $ 164,731 $ - Bank Overdraft Facility (2 ) - - - Loan Payable Bank - Export Refinance (3 ) 3,005,350 3,005,350 - Loan Payable Bank - Running Finance (4 ) - - - Loan Payable Bank - Export Refinance II (5 ) 2,284,065 2,284,065 - Loan Payable Bank - Running Finance II (6 ) - - - Loan Payable Bank - Export Refinance III (7 ) 3,005,350 3,005,350 - Related Party Loan (8 ) 69,425 16,174 53,251 8,528,921 8,475,670 53,251 Subsidiary Finance Leases (9 ) 571,639 319,188 252,451 $ 9,100,560 $ 8,794,858 $ 305,702 As of June 30, 2019 Current Long-Term Name Total Maturities Maturities D&O Insurance (1 ) $ 67,671 $ 67,671 $ - Bank Overdraft Facility (2 ) - - - Loan Payable Bank - Export Refinance (3 ) 3,066,355 3,066,355 - Loan Payable Bank - Running Finance (4 ) 325,034 325,034 - Loan Payable Bank - Export Refinance II (5 ) 2,330,431 2,330,431 - Loan Payable Bank - Running Finance II (6 ) 735,925 735,925 - Loan Payable Bank - Export Refinance III (7 ) - - - Related Party Loan (8 ) 82,969 15,838 67,131 6,608,385 6,541,254 67,131 Subsidiary Finance Leases (9 ) 861,784 364,343 497,441 $ 7,470,169 $ 6,905,597 $ 564,572 (1) The Company finances Directors’ and Officers’ (“D&O”) liability insurance and Errors and Omissions (“E&O”) liability insurance, for which the D&O and E&O balances are renewed on an annual basis and, as such, are recorded in current maturities. The interest rate on these financings were ranging from 5.0% to 7.0% as of March 31, 2020 and June 30, 2019. (2) The Company’s subsidiary, NTE, has an overdraft facility with HSBC Bank plc whereby the bank would cover any overdrafts up to £300,000, or approximately $370,370. The annual interest rate was 5.12% as of March 31, 2020. Total outstanding balance as of March 31, 2020 was £Nil. This overdraft facility requires that the aggregate amount of invoiced trade debtors (net of provisions for bad and doubtful debts and excluding intra-group debtors) of NTE, not exceeding 90 days old, will not be less than an amount equal to 200% of the facility. As of March 31, 2020, NTE was in compliance with this covenant. (3) The Company’s subsidiary, NetSol PK, has an export refinance facility with Askari Bank Limited, secured by NetSol PK’s assets. This is a revolving loan that matures every nine months. Total facility amount is Rs. 500,000,000 or $3,005,350 at March 31, 2020 and Rs. 500,000,000 or $3,066,355 at June 30, 2019. The interest rate for the loan was 3% at March 31, 2020 and June 30, 2019. (4) The Company’s subsidiary, NetSol PK, has a running finance facility with Askari Bank Limited, secured by NetSol PK’s assets. Total facility amount is Rs. 75,000,000 or $450,802, at March 31, 2020. NetSol PK used Rs. Nil, or $Nil at March 31, 2020. The interest rate for the loan was 13.2% and 13.0% at March 31, 2020 and June 30, 2019, respectively. This facility requires NetSol PK to maintain a long-term debt equity ratio of 60:40 and the current ratio of 1:1. As of March 31, 2020, NetSol PK was in compliance with this covenant. (5) The Company’s subsidiary, NetSol PK, has an export refinance facility with Samba Bank Limited, secured by NetSol PK’s assets. This is a revolving loan that matures every nine months. Total facility amount is Rs. 380,000,000 or $2,284,065 and Rs. 380,000,000 or $2,330,431 at March 31, 2020 and June 30, 2019, respectively. The interest rate for the loan was 3% at March 31, 2020 and June 30, 2019. (6) The Company’s subsidiary, NetSol PK, has a running finance facility with Samba Bank Limited, secured by NetSol PK’s assets. Total facility amount is Rs. 120,000,000 or $721,284 and Rs. 120,000,000 or $735,925, at March 31, 2020 and June 30, 2019, respectively. The interest rate for the loan was 12.9% and 14.3% at March 31, 2020 and June 30, 2019, respectively. Total outstanding balance at March 31, 2020 was Rs. Nil. During the tenure of loan, the facilities from Samba Bank Limited require NetSol PK to maintain at a minimum a current ratio of 1:1, an interest coverage ratio of 4 times, a leverage ratio of 2 times, and a debt service coverage ratio of 4 times. As of March 31, 2020, NetSol PK was in compliance with these covenants. (7) The Company’s subsidiary, NetSol PK, has an export refinance facility with Habib Metro Bank Limited, secured by NetSol PK’s assets. This is a revolving loan that matures every nine months. Total facility amount is Rs. 900,000,000 or $5,409,629 and NetSol PK used Rs. 500,000,000 or $3,005,350 at March 31, 2020. The interest rate for the loan was 3% at March 31, 2020. (8) In March 2019, the Company’s subsidiary, VLS, entered into a loan agreement. The loan amount was £69,549, or $85,863, for a period of 5 years with monthly payment of £1,349, or $1,666. As of March 31, 2020, the subsidiary has used this facility up to $69,425, of which $53,251 was shown as long-term and $16,174 as current. The interest rate was 6.14% at March 31, 2020. (9) The Company leases various fixed assets under finance lease arrangements expiring in various years through 2024. The assets and liabilities under finance leases are recorded at the lower of the present value of the minimum lease payments or the fair value of the asset. The assets are secured by the assets themselves. Depreciation of assets under finance leases is included in depreciation expense for the three months ended March 31, 2020 and 2019. Following is the aggregate minimum future lease payments under finance leases as of March 31, 2020: Amount Minimum Lease Payments Within year 1 $ 365,384 Within year 2 228,102 Within year 3 19,852 Within year 4 18,198 Total Minimum Lease Payments 631,536 Interest Expense relating to future periods (59,897 ) Present Value of minimum lease payments 571,639 Less: Current portion (319,188 ) Non-Current portion $ 252,451 |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | NOTE 17 - STOCKHOLDERS’ EQUITY During the nine months ended March 31, 2020, the Company issued 42,818 shares of common stock for services rendered by officers of the Company. These shares were valued at the fair market value of $239,799. During the nine months ended March 31, 2020, the Company issued 21,615 shares of common stock for services rendered by the independent members of the Board of Directors as part of their board compensation. These shares were valued at the fair market value of $106,601. During the nine months ended March 31, 2020, the Company issued 62,522 shares of its common stock to employees pursuant to the terms of their employment agreements valued at $319,066. |
Incentive and Non-statutory Sto
Incentive and Non-statutory Stock Option Plan | 9 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Incentive and Non-statutory Stock Option Plan | NOTE 18 - INCENTIVE AND NON-STATUTORY STOCK OPTION PLAN Common stock purchase options consisted of the following: OPTIONS: # of shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregated Intrinsic Value Outstanding and exercisable, June 30, 2019 40,386 $ 6.50 0.61 $ 404 Granted - - Exercised - - Expired / Cancelled (40,386 ) $ 6.50 Outstanding and exercisable, March 31, 2020 - - - $ - During the nine months ended March 31, 2020, 40,386 options outstanding and exercisable, became expired. The following table summarizes stock grants awarded as compensation: # of shares Weighted Average Grant Date Fair Value ($) Unvested, June 30, 2019 81,515 $ 5.88 Granted 148,221 $ 5.27 Vested (126,955 ) $ 5.24 Forfeited / Cancelled (991 ) $ 6.05 Unvested, March 31, 2020 101,790 $ 5.79 For the three and nine months ended March 31, 2020, the Company recorded compensation expense of $236,702 and $565,287, respectively. For the three and nine months ended March 31, 2019, the Company recorded compensation expense of $110,939 and $980,682, respectively. The compensation expense related to the unvested stock grants as of March 31, 2019 was $539,603 which will be recognized during the fiscal years 2020 through 2022. |
Contingencies
Contingencies | 9 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | NOTE 19 – CONTINGENCIES From time to time, the Company is subject to legal proceedings, claims, and litigation arising in the ordinary course of business including tax assessments. The Company defends itself vigorously against any such claims. When (i) it is probable that an asset has been impaired or a liability has been incurred and (ii) the amount of the loss can be reasonably estimated, the Company records the estimated loss. The Company provides disclosure in the notes to the consolidated financial statements for loss contingencies that do not meet both conditions if there is a reasonable possibility that a loss may have been incurred that would be material to the financial statements. Significant judgment is required to determine the probability that a liability has been incurred and whether such liability is reasonably estimable. The Company bases accruals on the best information available at the time, which can be highly subjective. The final outcome of these matters could vary significantly from the amounts included in the accompanying consolidated financial statements. |
Operating Segments
Operating Segments | 9 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Operating Segments | NOTE 20 – OPERATING SEGMENTS The Company has identified three segments for its products and services; North America, Europe and Asia-Pacific. Our reportable segments are business units located in different global regions. Each business unit provides similar products and services; license fees for leasing and asset-based software, related maintenance fees, and implementation and IT consulting services. Separate management of each segment is required because each business unit is subject to different operational issues and strategies due to their particular regional location. The Company accounts for intra-company sales and expenses as if the sales or expenses were to third parties and eliminates them in the consolidation. The following table presents a summary of identifiable assets as of March 31, 2020 and June 30, 2019: As of As of March 31, 2020 June 30, 2019 Identifiable assets: Corporate headquarters $ 4,263,871 $ 2,947,727 North America 5,441,314 5,730,928 Europe 9,689,483 8,399,033 Asia - Pacific 67,011,995 70,419,331 Consolidated $ 86,406,663 $ 87,497,019 The following table presents a summary of investment under equity method as of March 31, 2020 and June 30, 2019: As of As of March 31, 2020 June 30, 2019 Investment in associates under equity method: Corporate headquarters $ 509,281 $ 686,504 Asia - Pacific 1,820,425 1,967,265 Consolidated $ 2,329,706 $ 2,653,769 The following table presents a summary of operating information for the three and nine months ended March 31: For the Three Months For the Nine Months Ended March 31, Ended March 31, 2020 2019 2020 2019 Revenues from unaffiliated customers: North America $ 1,210,187 $ 1,022,655 $ 3,464,705 $ 2,843,190 Europe 2,791,238 2,405,234 8,225,906 6,425,393 Asia - Pacific 9,467,570 13,542,170 30,900,462 40,696,025 13,468,995 16,970,059 42,591,073 49,964,608 Revenue from affiliated customers Asia - Pacific 61,842 156,996 202,199 561,619 61,842 156,996 202,199 561,619 Consolidated $ 13,530,837 $ 17,127,055 $ 42,793,272 $ 50,526,227 Intercompany revenue Europe $ 143,814 $ 120,153 $ 455,040 $ 416,483 Asia - Pacific 2,048,652 1,389,773 5,618,855 6,887,631 Eliminated $ 2,192,466 $ 1,509,926 $ 6,073,895 $ 7,304,114 Net income (loss) after taxes and before non-controlling interest: Corporate headquarters $ 240,294 $ 692,854 $ (1,003,798 ) $ (1,667,600 ) North America 134,390 (92,029 ) 230,738 (426,209 ) Europe 122,974 330,039 927,717 735,972 Asia - Pacific 971,435 838,531 (399,887 ) 8,739,351 Consolidated $ 1,469,093 $ 1,769,395 $ (245,230 ) $ 7,381,514 The following table presents a summary of capital expenditures for the nine months ended March 31: For the Nine Months Ended March 31, 2020 2019 Capital expenditures: North America $ 2,404 $ 1,383 Europe 487,693 461,376 Asia - Pacific 521,188 2,127,543 Consolidated $ 1,011,285 $ 2,590,302 |
Non-Controlling Interest in Sub
Non-Controlling Interest in Subsidiary | 9 Months Ended |
Mar. 31, 2020 | |
Noncontrolling Interest [Abstract] | |
Non-Controlling Interest in Subsidiary | NOTE 21 – NON-CONTROLLING INTEREST IN SUBSIDIARY The Company had non-controlling interests in several of its subsidiaries. The balance of non-controlling interest was as follows: SUBSIDIARY Non-Controlling Interest % Non-Controlling Interest at March 31, 2020 NetSol PK 33.88 % $ 6,203,015 NetSol-Innovation 49.90 % 158,549 NetSol Thai 0.006 % (11 ) Total $ 6,361,553 SUBSIDIARY Non-Controlling Interest % Non-Controlling Interest at June 30, 2019 NetSol PK 33.80 % $ 6,993,491 NetSol-Innovation 49.90 % 1,421,528 NetSol Thai 0.006 % (32 ) Total $ 8,414,987 NetSol PK During the nine months ended March 31, 2020, employees of NetSol PK exercised 114,000 options of common stock and NetSol PK received cash of $11,261. Due to the exercise of options, the non-controlling interest increased from 33.80% to 33.88%. During the nine months ended March 31, 2020, NetSol PK paid a cash dividend of $1,610,909. NetSol Innovation During the nine months ended March 31, 2020, NetSol Innovation paid a cash dividend of $2,778,453. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 22 – SUBSEQUENT EVENTS COVID-19 The recent outbreak of the coronavirus, also known as "COVID-19", has spread across the globe and is impacting worldwide economic activity. Conditions surrounding the coronavirus continue to rapidly evolve and government authorities have implemented emergency measures to mitigate the spread of the virus. The outbreak and the related mitigation measures have had and will continue to have a material adverse impact on global economic conditions as well as on the Company's business activities. The extent to which COVID-19 may impact the Company's business activities will depend on future developments, such as the ultimate geographic spread of the disease, the duration of the outbreak, travel restrictions, business disruptions, and the effectiveness of actions taken in the United States and other countries to contain and treat the disease. These events are highly uncertain and, as such, the Company cannot determine their financial impact at this time. No adjustments have been made to the amounts reported in these condensed consolidated financial statements as a result of this matter. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 9 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The areas requiring significant estimates are provision for doubtful accounts, provision for taxation, useful life of depreciable assets, useful life of intangible assets, contingencies, assumptions used to determine the net present value of operating lease liabilities, and estimated contract costs. The estimates and underlying assumptions are reviewed on an ongoing basis. Actual results could differ from those estimates. |
Concentration of Credit Risk | Concentration of Credit Risk Cash includes cash on hand and demand deposits in accounts maintained within the United States as well as in foreign countries. Certain financial instruments, which subject the Company to concentration of credit risk, consist of cash and restricted cash. The Company maintains balances at financial institutions which, from time to time, may exceed Federal Deposit Insurance Corporation insured limits for the banks located in the United States. Balances at financial institutions within certain foreign countries are not covered by insurance. As of March 31, 2020, and June 30, 2019, the Company had uninsured deposits related to cash deposits in accounts maintained within foreign entities of approximately $14,677,110 and $16,124,339, respectively. The Company has not experienced any losses in such accounts. The Company’s operations are carried out globally. Accordingly, the Company’s business, financial condition and results of operations may be influenced by the political, economic and legal environments of each country and by the general state of the country’s economy. The Company’s operations in each foreign country are subject to specific considerations and significant risks not typically associated with companies in economically developed nations. These include risks associated with, among others, the political, economic and legal environments and foreign currency exchange. The Company’s results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company applies the provisions of Accounting Standards Codification (“ASC”) 820-10, “Fair Value Measurements and Disclosures.” The three levels of valuation hierarchy are defined as follows: Level 1: Valuations consist of unadjusted quoted prices in active markets for identical assets and liabilities and has the highest priority. Level 2: Valuations rely on quoted prices in markets that are not active or observable inputs over the full term of the asset or liability. Level 3: Valuations are based on prices or third party or internal valuation models that require inputs that are significant to the fair value measurement and are less observable and thus have the lowest priority. The Company’s assets that were measured at fair value on a recurring basis as of March 31, 2020, were as follows: Level 1 Level 2 Level 3 Total Assets Revenues in excess of billings - long term $ - $ - $ 1,282,898 $ 1,282,898 Total $ - $ - $ 1,282,898 $ 1,282,898 The Company’s financial assets that were measured at fair value on a recurring basis as of June 30, 2019, were as follows: Level 1 Level 2 Level 3 Total Assets Revenues in excess of billings - long term $ - $ - $ 1,281,492 $ 1,281,492 Total $ - $ - $ 1,281,492 $ 1,281,492 The reconciliation from June 30, 2019 to March 31, 2020 is as follows: Revenues in excess Fair value discount Total Balance at June 30, 2018 $ 1,445,245 $ (238,576 ) $ 1,206,669 Effect of ASC 606 adoption (1,445,245 ) 238,576 (1,206,669 ) Additions 1,380,631 (99,139 ) 1,281,492 Balance at June 30, 2019 $ 1,380,631 $ (99,139 ) $ 1,281,492 Amortization during the period - 41,621 41,621 Effect of Translation Adjustment (42,840 ) 2,625 (40,215 ) Balance at March 31, 2020 $ 1,337,791 $ (54,893 ) $ 1,282,898 Management analyzes all financial instruments with features of both liabilities and equity under ASC 480, “Distinguishing Liabilities from Equity” “Derivatives and Hedging.” |
New Accounting Pronouncements | New Accounting Pronouncements Recent Accounting Standards Adopted by the Company: In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842). This pronouncement requires lessees to recognize a liability for lease obligations, which represents the discounted obligation to make future lease payments, and a corresponding right-of-use (“ROU”) asset on the balance sheet. The Company adopted ASU 2016-02, along with related clarifications and improvements, as of July 1, 2019, using the modified retrospective approach, which allows the Company to apply ASC 840, Leases, in the comparative periods presented in the year of adoption. Accordingly, the comparative periods and disclosures have not been restated. The Company elected the package of practical expedients to not reassess: ● whether a contract is or contains a lease ● lease classification ● initial direct costs Additionally, the Company adopted the policy election to not recognize ROU assets and lease liabilities for short-term leases for all asset classes. Adoption of the new standard resulted in the recording of a non-cash transitional adjustment to ROU assets and lease liabilities of $3,011,814 and $3,091,236, respectively, as of July 1, 2019. The difference between the ROU assets and lease liabilities represented existing deferred rent expense and prepaid rent that were derecognized and adjusted the ROU assets in the Condensed Consolidated Balance Sheets. The adoption of ASU 2016-02 did not materially impact the results of operations or cash flows. Accounting Standards Recently Issued but Not Yet Adopted by the Company: In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment In July 2017, the FASB issued ASU 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815): (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. All other newly issued accounting pronouncements not yet effective have been deemed either immaterial or not applicable. |
Basis of Presentation and Pri_2
Basis of Presentation and Principles of Consolidation (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Reclassified Net Revenues | For comparative purposes, prior year’s condensed consolidated financial statements have been reclassified to conform to report classifications of the current period. Below is the table of reclassified amounts: For the Three Months Ended For the Nine Months Ended March 31, 2019 March 31, 2019 Originally reported Reclassified Originally reported Reclassified REVENUES License fees $ 2,536,320 $ 2,536,320 $ 13,310,002 $ 13,310,002 Maintenance fees 3,562,412 3,704,756 10,735,432 11,106,155 Services 10,519,219 10,728,983 25,175,187 25,548,451 Maintenance fees - related party 142,344 - 370,723 - Services - related party 366,760 156,996 934,883 561,619 Total net revenues $ 17,127,055 $ 17,127,055 $ 50,526,227 $ 50,526,227 |
Accounting Policies (Tables)
Accounting Policies (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Fair Value of Financial Assets Measured on Recurring Basis | The Company’s assets that were measured at fair value on a recurring basis as of March 31, 2020, were as follows: Level 1 Level 2 Level 3 Total Assets Revenues in excess of billings - long term $ - $ - $ 1,282,898 $ 1,282,898 Total $ - $ - $ 1,282,898 $ 1,282,898 The Company’s financial assets that were measured at fair value on a recurring basis as of June 30, 2019, were as follows: Level 1 Level 2 Level 3 Total Assets Revenues in excess of billings - long term $ - $ - $ 1,281,492 $ 1,281,492 Total $ - $ - $ 1,281,492 $ 1,281,492 |
Schedule of Fair Value of Financial Instruments Reconciliation | The reconciliation from June 30, 2019 to March 31, 2020 is as follows: Revenues in excess Fair value discount Total Balance at June 30, 2018 $ 1,445,245 $ (238,576 ) $ 1,206,669 Effect of ASC 606 adoption (1,445,245 ) 238,576 (1,206,669 ) Additions 1,380,631 (99,139 ) 1,281,492 Balance at June 30, 2019 $ 1,380,631 $ (99,139 ) $ 1,281,492 Amortization during the period - 41,621 41,621 Effect of Translation Adjustment (42,840 ) 2,625 (40,215 ) Balance at March 31, 2020 $ 1,337,791 $ (54,893 ) $ 1,282,898 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Schedule of Disaggregated Revenue by Category | The Company’s disaggregated revenue by category is as follows: For the Three Months For the Nine Months Ended March 31, Ended March 31, 2020 2019 2020 2019 Core: License $ 312,133 $ 2,536,320 $ 3,375,241 $ 13,310,002 Maintenance 4,934,635 3,704,756 14,291,959 11,106,155 Services 6,430,189 9,148,894 19,615,987 21,005,540 Services - related party 61,842 156,996 202,199 494,333 Total core revenue, net 11,738,799 15,546,966 37,485,386 45,916,030 Non-Core: Services 1,792,038 1,580,089 5,307,886 4,542,911 Services - related party - - - 67,286 Total non-core revenue, net 1,792,038 1,580,089 5,307,886 4,610,197 Total net revenue $ 13,530,837 $ 17,127,055 $ 42,793,272 $ 50,526,227 |
Schedule of Revenues in Excess of Billings and Deferred Revenue | The Company’s revenues in excess of billings and deferred revenue are as follows: As of As of March 31, 2020 June 30, 2019 Revenues in excess of billings $ 16,592,293 $ 16,111,366 Deferred Revenue $ 3,440,663 $ 5,977,736 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Components of Basic and Diluted Earnings Per Share | The components of basic and diluted earnings per share were as follows: For the three months ended March 31, 2020 For the nine months ended March 31, 2020 Net Income Shares Per Share Net Loss Shares Per Share Basic income (loss) per share: Net income (loss) available to common shareholders $ 1,000,807 11,753,063 $ 0.09 $ (241,165 ) 11,713,827 $ (0.02 ) Effect of dilutive securities Stock options - - - - - - Share grants - - - - - - Diluted income (loss) per share $ 1,000,807 11,753,063 $ 0.09 $ (241,165 ) 11,713,827 $ (0.02 ) For the three months ended March 31, 2019 For the nine months ended March 31, 2019 Net Income Shares Per Share Net Income Shares Per Share Basic income per share: Net income available to common shareholders $ 1,267,560 11,656,098 $ 0.11 $ 5,085,778 11,580,066 $ 0.44 Effect of dilutive securities Stock options - 4,948 - - 5,686 - Share grants - 30,296 - - - - Diluted income per share $ 1,267,560 11,691,342 $ 0.11 $ 5,085,778 11,585,752 $ 0.44 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following potential dilutive shares were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive. For the Three Months For the Nine Months Ended March 31, Ended March 31, 2020 2019 2020 2019 Share Grants 101,790 - 101,790 - 101,790 - 101,790 - |
Convertible Note Receivable -_2
Convertible Note Receivable - Related Party (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Receivables [Abstract] | |
Schedule of Convertible Note | The following table summarizes the convertible notes receivable from WRLD3D. Convertible Agreement Interest Maturity Note Date Rate Date Amount May 25, 2017 5 % On Demand $ 750,000 February 9, 2018 10 % On Demand 2,500,000 April 1, 2019 10 % March 31, 2020 600,000 August 19, 2019 10 % March 31, 2020 400,000 $ 4,250,000 |
Other Current Assets (Tables)
Other Current Assets (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Current Assets | Other current assets consisted of the following: As of As of March 31, 2020 June 30, 2019 Prepaid Expenses $ 968,504 $ 991,528 Advance Income Tax 482,518 800,798 Employee Advances 125,653 33,778 Security Deposits 282,596 147,668 Other Receivables 1,534,222 733,826 Other Assets 199,872 438,666 Total $ 3,593,365 $ 3,146,264 |
Revenues in Excess of Billing_2
Revenues in Excess of Billings - Long Term (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Contractors [Abstract] | |
Schedule of Revenues in Excess of Billings | Revenues in excess of billings, net consisted of the following: As of As of March 31, 2020 June 30, 2019 Revenues in excess of billings - long term $ 1,337,791 $ 1,380,631 Present value discount (54,893 ) (99,139 ) Net Balance $ 1,282,898 $ 1,281,492 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consisted of the following: As of As of March 31, 2020 June 30, 2019 Office Furniture and Equipment $ 3,132,869 $ 3,125,382 Computer Equipment 19,077,749 18,905,603 Assets Under Capital Leases 1,553,868 1,720,490 Building 5,905,714 6,021,939 Land 1,528,091 1,559,111 Capital Work In Progress 12,899 - Autos 1,301,193 1,024,754 Improvements 87,609 111,165 Subtotal 32,599,992 32,468,444 Accumulated Depreciation (21,046,178 ) (20,371,589 ) Property and Equipment, Net $ 11,553,814 $ 12,096,855 |
Summary of Fixed Assets Held Under Finance Leases | Following is a summary of fixed assets held under finance leases as of March 31, 2020 and June 30, 2019: As of As of March 31, 2020 June 30, 2019 Computers and Other Equipment $ 328,998 $ 324,466 Furniture and Fixtures 51,119 65,084 Vehicles 1,173,751 1,330,940 Total 1,553,868 1,720,490 Less: Accumulated Depreciation - Net (652,372 ) (538,564 ) $ 901,496 $ 1,181,926 |
Schedule of Finance Lease Term | Finance lease term and discount rate were as follows: As of March 31, 2020 Weighted average remaining lease term - Finance leases 1.65 Years Weighted average discount rate - Finance leases 13.0 % |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Schedule of Balance Sheet Information Related to Leases | Supplemental balance sheet information related to leases was as follows: As of March 31, 2020 Assets Operating lease assets, net $ 2,690,777 Liabilities Current Operating $ 1,146,696 Non-current Operating 1,635,866 Total Lease Liabilities $ 2,782,562 |
Schedule of Components of Lease Cost | The components of lease cost were as follows: For the Nine Months Ended March 31, 2020 Amortization of finance lease assets $ 194,632 Interest on finance lease obligation 71,416 Operating lease cost 931,955 Short term lease cost 228,869 Sub lease income (25,227 ) Total lease cost $ 1,401,645 |
Schedule of Lease Term and Discount Rate | Lease term and discount rate were as follows: As of March 31, 2020 Weighted average remaining lease term - Operating leases 2.66 Years Weighted average discount rate - Operating leases 5.6 % |
Schedule of Supplemental Disclosures of Cash Flow Information Related to Leases | Supplemental disclosures of cash flow information related to leases were as follows: For the Nine Months Ended March 31, 2020 Cash flows related to lease liabilities Operating cash flows related to operating leases $ 905,076 |
Schedule of Maturities of Operating Lease Liabilities | Maturities of operating lease liabilities were as follows as of March 31, 2020: Amount Within year 1 $ 1,267,595 Within year 2 958,385 Within year 3 604,275 Within year 4 132,663 Within year 5 32,001 Thereafter 3,372 Total Lease Payments 2,998,291 Less: Imputed interest (215,729 ) Present Value of lease liabilities 2,782,562 Less: Current portion (1,146,696 ) Non-Current portion $ 1,635,866 |
Schedule of Future Minimum Lease Payments | As of June 30, 2019, future minimum lease payments, as defined under the previous lease accounting guidance of ASC Topic 840, under non-cancelable operating leases for the following five fiscal years and thereafter were as follows: Within year 1 $ 744,549 Within year 2 514,243 Within year 3 269,375 Within year 4 197,872 Within year 5 36,044 Total $ 1,762,083 |
Long Term Investment (Tables)
Long Term Investment (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Investments, All Other Investments [Abstract] | |
Schedule of Long Term Investment | The following table reflects the above investments at March 31, 2020. Drivemate WRLD3D Total Initial investment $ 250,000 $ 3,888,889 $ 4,138,889 Cumulative net loss on investment (19,015 ) (1,351,413 ) (1,370,428 ) Cumulative Other comprehensive income (loss) - (438,755 ) (438,755 ) Net Investment $ 230,985 $ 2,098,721 $ 2,329,706 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Intangible assets consisted of the following: As of As of March 31, 2020 June 30, 2019 Product Licenses - Cost $ 47,244,997 $ 47,244,997 Effect of Translation Adjustment (15,833,112 ) (15,343,727 ) Accumulated Amortization (25,531,126 ) (24,568,320 ) Net Balance $ 5,880,759 $ 7,332,950 |
Summary of Estimated Amortization Expense of Intangible Assets | Estimated amortization expense of intangible assets over the next five years is as follows: Year ended: March 31, 2021 $ 1,748,286 March 31, 2022 1,748,286 March 31, 2023 1,748,286 March 31, 2024 635,901 $ 5,880,759 |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses consisted of the following: As of As of March 31, 2020 June 30, 2019 Accounts Payable $ 1,711,503 $ 1,156,498 Accrued Liabilities 4,478,601 5,055,358 Accrued Payroll & Taxes 553,223 793,503 Taxes Payable 196,376 326,386 Other Payable 168,230 144,815 Total $ 7,107,933 $ 7,476,560 |
Debts (Tables)
Debts (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Components of Notes Payable and Finance Leases | Notes payable and finance leases consisted of the following: As of March 31, 2020 Current Long-Term Name Total Maturities Maturities D&O Insurance (1 ) $ 164,731 $ 164,731 $ - Bank Overdraft Facility (2 ) - - - Loan Payable Bank - Export Refinance (3 ) 3,005,350 3,005,350 - Loan Payable Bank - Running Finance (4 ) - - - Loan Payable Bank - Export Refinance II (5 ) 2,284,065 2,284,065 - Loan Payable Bank - Running Finance II (6 ) - - - Loan Payable Bank - Export Refinance III (7 ) 3,005,350 3,005,350 - Related Party Loan (8 ) 69,425 16,174 53,251 8,528,921 8,475,670 53,251 Subsidiary Finance Leases (9 ) 571,639 319,188 252,451 $ 9,100,560 $ 8,794,858 $ 305,702 As of June 30, 2019 Current Long-Term Name Total Maturities Maturities D&O Insurance (1 ) $ 67,671 $ 67,671 $ - Bank Overdraft Facility (2 ) - - - Loan Payable Bank - Export Refinance (3 ) 3,066,355 3,066,355 - Loan Payable Bank - Running Finance (4 ) 325,034 325,034 - Loan Payable Bank - Export Refinance II (5 ) 2,330,431 2,330,431 - Loan Payable Bank - Running Finance II (6 ) 735,925 735,925 - Loan Payable Bank - Export Refinance III (7 ) - - - Related Party Loan (8 ) 82,969 15,838 67,131 6,608,385 6,541,254 67,131 Subsidiary Finance Leases (9 ) 861,784 364,343 497,441 $ 7,470,169 $ 6,905,597 $ 564,572 (1) The Company finances Directors’ and Officers’ (“D&O”) liability insurance and Errors and Omissions (“E&O”) liability insurance, for which the D&O and E&O balances are renewed on an annual basis and, as such, are recorded in current maturities. The interest rate on these financings were ranging from 5.0% to 7.0% as of March 31, 2020 and June 30, 2019. (2) The Company’s subsidiary, NTE, has an overdraft facility with HSBC Bank plc whereby the bank would cover any overdrafts up to £300,000, or approximately $370,370. The annual interest rate was 5.12% as of March 31, 2020. Total outstanding balance as of March 31, 2020 was £Nil. This overdraft facility requires that the aggregate amount of invoiced trade debtors (net of provisions for bad and doubtful debts and excluding intra-group debtors) of NTE, not exceeding 90 days old, will not be less than an amount equal to 200% of the facility. As of March 31, 2020, NTE was in compliance with this covenant. (3) The Company’s subsidiary, NetSol PK, has an export refinance facility with Askari Bank Limited, secured by NetSol PK’s assets. This is a revolving loan that matures every nine months. Total facility amount is Rs. 500,000,000 or $3,005,350 at March 31, 2020 and Rs. 500,000,000 or $3,066,355 at June 30, 2019. The interest rate for the loan was 3% at March 31, 2020 and June 30, 2019. (4) The Company’s subsidiary, NetSol PK, has a running finance facility with Askari Bank Limited, secured by NetSol PK’s assets. Total facility amount is Rs. 75,000,000 or $450,802, at March 31, 2020. NetSol PK used Rs. Nil, or $Nil at March 31, 2020. The interest rate for the loan was 13.2% and 13.0% at March 31, 2020 and June 30, 2019, respectively. This facility requires NetSol PK to maintain a long-term debt equity ratio of 60:40 and the current ratio of 1:1. As of March 31, 2020, NetSol PK was in compliance with this covenant. (5) The Company’s subsidiary, NetSol PK, has an export refinance facility with Samba Bank Limited, secured by NetSol PK’s assets. This is a revolving loan that matures every nine months. Total facility amount is Rs. 380,000,000 or $2,284,065 and Rs. 380,000,000 or $2,330,431 at March 31, 2020 and June 30, 2019, respectively. The interest rate for the loan was 3% at March 31, 2020 and June 30, 2019. (6) The Company’s subsidiary, NetSol PK, has a running finance facility with Samba Bank Limited, secured by NetSol PK’s assets. Total facility amount is Rs. 120,000,000 or $721,284 and Rs. 120,000,000 or $735,925, at March 31, 2020 and June 30, 2019, respectively. The interest rate for the loan was 12.9% and 14.3% at March 31, 2020 and June 30, 2019, respectively. Total outstanding balance at March 31, 2020 was Rs. Nil. During the tenure of loan, the facilities from Samba Bank Limited require NetSol PK to maintain at a minimum a current ratio of 1:1, an interest coverage ratio of 4 times, a leverage ratio of 2 times, and a debt service coverage ratio of 4 times. As of March 31, 2020, NetSol PK was in compliance with these covenants. (7) The Company’s subsidiary, NetSol PK, has an export refinance facility with Habib Metro Bank Limited, secured by NetSol PK’s assets. This is a revolving loan that matures every nine months. Total facility amount is Rs. 900,000,000 or $5,409,629 and NetSol PK used Rs. 500,000,000 or $3,005,350 at March 31, 2020. The interest rate for the loan was 3% at March 31, 2020. (8) In March 2019, the Company’s subsidiary, VLS, entered into a loan agreement. The loan amount was £69,549, or $85,863, for a period of 5 years with monthly payment of £1,349, or $1,666. As of March 31, 2020, the subsidiary has used this facility up to $69,425, of which $53,251 was shown as long-term and $16,174 as current. The interest rate was 6.14% at March 31, 2020. (9) The Company leases various fixed assets under finance lease arrangements expiring in various years through 2024. The assets and liabilities under finance leases are recorded at the lower of the present value of the minimum lease payments or the fair value of the asset. The assets are secured by the assets themselves. Depreciation of assets under finance leases is included in depreciation expense for the three months ended March 31, 2020 and 2019. |
Schedule of Aggregate Minimum Future Lease Payments Under Finance Leases | Following is the aggregate minimum future lease payments under finance leases as of March 31, 2020: Amount Minimum Lease Payments Within year 1 $ 365,384 Within year 2 228,102 Within year 3 19,852 Within year 4 18,198 Total Minimum Lease Payments 631,536 Interest Expense relating to future periods (59,897 ) Present Value of minimum lease payments 571,639 Less: Current portion (319,188 ) Non-Current portion $ 252,451 |
Incentive and Non-Statutory S_2
Incentive and Non-Statutory Stock Option Plan (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Components of Common Stock Purchase Options | Common stock purchase options consisted of the following: OPTIONS: # of shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in years) Aggregated Intrinsic Value Outstanding and exercisable, June 30, 2019 40,386 $ 6.50 0.61 $ 404 Granted - - Exercised - - Expired / Cancelled (40,386 ) $ 6.50 Outstanding and exercisable, March 31, 2020 - - - $ - |
Summary of Unvested Stock Grants Awarded as Compensation | The following table summarizes stock grants awarded as compensation: # of shares Weighted Average Grant Date Fair Value ($) Unvested, June 30, 2019 81,515 $ 5.88 Granted 148,221 $ 5.27 Vested (126,955 ) $ 5.24 Forfeited / Cancelled (991 ) $ 6.05 Unvested, March 31, 2020 101,790 $ 5.79 |
Operating Segments (Tables)
Operating Segments (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Summary of Identifiable Assets | The following table presents a summary of identifiable assets as of March 31, 2020 and June 30, 2019: As of As of March 31, 2020 June 30, 2019 Identifiable assets: Corporate headquarters $ 4,263,871 $ 2,947,727 North America 5,441,314 5,730,928 Europe 9,689,483 8,399,033 Asia - Pacific 67,011,995 70,419,331 Consolidated $ 86,406,663 $ 87,497,019 |
Summary of Investment Under Equity Method | The following table presents a summary of investment under equity method as of March 31, 2020 and June 30, 2019: As of As of March 31, 2020 June 30, 2019 Investment in associates under equity method: Corporate headquarters $ 509,281 $ 686,504 Asia - Pacific 1,820,425 1,967,265 Consolidated $ 2,329,706 $ 2,653,769 |
Summary of Operating Information | The following table presents a summary of operating information for the three and nine months ended March 31: For the Three Months For the Nine Months Ended March 31, Ended March 31, 2020 2019 2020 2019 Revenues from unaffiliated customers: North America $ 1,210,187 $ 1,022,655 $ 3,464,705 $ 2,843,190 Europe 2,791,238 2,405,234 8,225,906 6,425,393 Asia - Pacific 9,467,570 13,542,170 30,900,462 40,696,025 13,468,995 16,970,059 42,591,073 49,964,608 Revenue from affiliated customers Asia - Pacific 61,842 156,996 202,199 561,619 61,842 156,996 202,199 561,619 Consolidated $ 13,530,837 $ 17,127,055 $ 42,793,272 $ 50,526,227 Intercompany revenue Europe $ 143,814 $ 120,153 $ 455,040 $ 416,483 Asia - Pacific 2,048,652 1,389,773 5,618,855 6,887,631 Eliminated $ 2,192,466 $ 1,509,926 $ 6,073,895 $ 7,304,114 Net income (loss) after taxes and before non-controlling interest: Corporate headquarters $ 240,294 $ 692,854 $ (1,003,798 ) $ (1,667,600 ) North America 134,390 (92,029 ) 230,738 (426,209 ) Europe 122,974 330,039 927,717 735,972 Asia - Pacific 971,435 838,531 (399,887 ) 8,739,351 Consolidated $ 1,469,093 $ 1,769,395 $ (245,230 ) $ 7,381,514 |
Summary of Capital Expenditures | The following table presents a summary of capital expenditures for the nine months ended March 31: For the Nine Months Ended March 31, 2020 2019 Capital expenditures: North America $ 2,404 $ 1,383 Europe 487,693 461,376 Asia - Pacific 521,188 2,127,543 Consolidated $ 1,011,285 $ 2,590,302 |
Non-Controlling Interest in S_2
Non-Controlling Interest in Subsidiary (Tables) | 9 Months Ended |
Mar. 31, 2020 | |
Noncontrolling Interest [Abstract] | |
Schedule of Balance of Non-Controlling Interest | The Company had non-controlling interests in several of its subsidiaries. The balance of non-controlling interest was as follows: SUBSIDIARY Non-Controlling Interest % Non-Controlling Interest at March 31, 2020 NetSol PK 33.88 % $ 6,203,015 NetSol-Innovation 49.90 % 158,549 NetSol Thai 0.006 % (11 ) Total $ 6,361,553 SUBSIDIARY Non-Controlling Interest % Non-Controlling Interest at June 30, 2019 NetSol PK 33.80 % $ 6,993,491 NetSol-Innovation 49.90 % 1,421,528 NetSol Thai 0.006 % (32 ) Total $ 8,414,987 |
Basis of Presentation and Pri_3
Basis of Presentation and Principles of Consolidation - Schedule of Reclassified Net Revenues (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Total net revenues | $ 13,530,837 | $ 17,127,055 | $ 42,793,272 | $ 50,526,227 |
License Fees [Member] | ||||
Total net revenues | 312,133 | 2,536,320 | 3,375,241 | 13,310,002 |
Maintenance Fees [Member] | ||||
Total net revenues | 4,934,635 | 3,704,756 | 14,291,959 | 11,106,155 |
Services [Member] | ||||
Total net revenues | 8,222,227 | 10,728,983 | 24,923,873 | 25,548,451 |
Services - Related Party [Member] | ||||
Total net revenues | $ 61,842 | 156,996 | $ 202,199 | 561,619 |
As Originally Presented [Member] | ||||
Total net revenues | 17,127,055 | 50,526,227 | ||
As Originally Presented [Member] | License Fees [Member] | ||||
Total net revenues | 2,536,320 | 13,310,002 | ||
As Originally Presented [Member] | Maintenance Fees [Member] | ||||
Total net revenues | 3,562,412 | 10,735,432 | ||
As Originally Presented [Member] | Services [Member] | ||||
Total net revenues | 10,519,219 | 25,175,187 | ||
As Originally Presented [Member] | Maintenance Fees - Related Party [Member] | ||||
Total net revenues | 142,344 | 370,723 | ||
As Originally Presented [Member] | Services - Related Party [Member] | ||||
Total net revenues | 366,760 | 934,883 | ||
Reclassified [Member] | ||||
Total net revenues | 17,127,055 | 50,526,227 | ||
Reclassified [Member] | License Fees [Member] | ||||
Total net revenues | 2,536,320 | 13,310,002 | ||
Reclassified [Member] | Maintenance Fees [Member] | ||||
Total net revenues | 3,704,756 | 11,106,155 | ||
Reclassified [Member] | Services [Member] | ||||
Total net revenues | 10,728,983 | 25,548,451 | ||
Reclassified [Member] | Maintenance Fees - Related Party [Member] | ||||
Total net revenues | ||||
Reclassified [Member] | Services - Related Party [Member] | ||||
Total net revenues | $ 156,996 | $ 561,619 |
Accounting Policies (Details Na
Accounting Policies (Details Narrative) - USD ($) | Mar. 31, 2020 | Jul. 02, 2019 | Jun. 30, 2019 |
Uninsured deposits related to cash deposits | $ 14,677,110 | $ 16,124,339 | |
Operating lease assets, net | 2,690,777 | ||
Lease liabilities | $ 2,782,562 | ||
Accounting Standards Update ("ASU") No. 2016-02 [Member] | |||
Operating lease assets, net | $ 3,011,814 | ||
Lease liabilities | $ 3,091,236 |
Accounting Policies - Schedule
Accounting Policies - Schedule of Fair Value of Financial Assets Measured on Recurring Basis (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Revenues in excess of billings - long term | $ 1,282,898 | $ 1,281,492 |
Total | 1,282,898 | 1,281,492 |
Level 1 [Member] | ||
Revenues in excess of billings - long term | ||
Total | ||
Level 2 [Member] | ||
Revenues in excess of billings - long term | ||
Total | ||
Level 3 [Member] | ||
Revenues in excess of billings - long term | 1,282,898 | 1,281,492 |
Total | $ 1,282,898 | $ 1,281,492 |
Accounting Policies - Schedul_2
Accounting Policies - Schedule of Fair Value of Financial Instruments Reconciliation (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Jun. 30, 2019 | |
Revenue in excess of billing long term beginning balance | $ 16,111,366 | $ 1,206,669 |
Effect of ASC 606 adoption | (1,206,669) | |
Additions | 1,281,492 | |
Amortization during the period | 41,621 | |
Effect of Translation Adjustment | (40,215) | |
Revenue in excess of billing long term ending balance | 16,592,293 | 16,111,366 |
Revenue in Excess of Billing - Long Term [Member] | ||
Revenue in excess of billing long term beginning balance | 1,380,631 | 1,445,245 |
Effect of ASC 606 adoption | (1,445,245) | |
Additions | 1,380,631 | |
Amortization during the period | ||
Effect of Translation Adjustment | (42,840) | |
Revenue in excess of billing long term ending balance | 1,337,791 | 1,380,631 |
Fair Value Discount [Member] | ||
Revenue in excess of billing long term beginning balance | (99,139) | (238,576) |
Effect of ASC 606 adoption | 238,576 | |
Additions | (99,139) | |
Amortization during the period | 41,621 | |
Effect of Translation Adjustment | 2,625 | |
Revenue in excess of billing long term ending balance | $ (54,893) | $ (99,139) |
Revenue Recognition (Details Na
Revenue Recognition (Details Narrative) | 3 Months Ended | 9 Months Ended |
Mar. 31, 2020USD ($) | Mar. 31, 2020USD ($) | |
Revenue Recognition and Deferred Revenue [Abstract] | ||
Deferred revenue, revenue recognized | $ 586,899 | $ 5,638,097 |
Contracted but unsatisfied performance obligations | 63,609,872 | 63,609,872 |
Contracted but unsatisfied performance obligations, next twelve months | $ 13,066,505 | $ 13,066,505 |
Estimated revenue recognized term | 5 years |
Revenue Recognition - Schedule
Revenue Recognition - Schedule of Disaggregated Revenue by Category (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Total net revenues | $ 13,530,837 | $ 17,127,055 | $ 42,793,272 | $ 50,526,227 |
License Fees [Member] | ||||
Total net revenues | 312,133 | 2,536,320 | 3,375,241 | 13,310,002 |
Maintenance Fees [Member] | ||||
Total net revenues | 4,934,635 | 3,704,756 | 14,291,959 | 11,106,155 |
Services [Member] | ||||
Total net revenues | 8,222,227 | 10,728,983 | 24,923,873 | 25,548,451 |
Services - Related Party [Member] | ||||
Total net revenues | 61,842 | 156,996 | 202,199 | 561,619 |
Core Revenue [Member] | ||||
Total net revenues | 11,738,799 | 15,546,966 | 37,485,386 | 45,916,030 |
Core Revenue [Member] | License Fees [Member] | ||||
Total net revenues | 312,133 | 2,536,320 | 3,375,241 | 13,310,002 |
Core Revenue [Member] | Maintenance Fees [Member] | ||||
Total net revenues | 4,934,635 | 3,704,756 | 14,291,959 | 11,106,155 |
Core Revenue [Member] | Services [Member] | ||||
Total net revenues | 6,430,189 | 9,148,894 | 19,615,987 | 21,005,540 |
Core Revenue [Member] | Services - Related Party [Member] | ||||
Total net revenues | 61,842 | 156,996 | 202,199 | 494,333 |
Non-Core Revenue [Member] | ||||
Total net revenues | 1,792,038 | 1,580,089 | 5,307,886 | 4,610,197 |
Non-Core Revenue [Member] | Services [Member] | ||||
Total net revenues | 1,792,038 | 1,580,089 | 5,307,886 | 4,542,911 |
Non-Core Revenue [Member] | Services - Related Party [Member] | ||||
Total net revenues | $ 67,286 |
Revenue Recognition - Schedul_2
Revenue Recognition - Schedule of Revenues in Excess of Billings and Deferred Revenue (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 | Jun. 30, 2018 |
Revenue Recognition and Deferred Revenue [Abstract] | |||
Revenues in excess of billings | $ 16,592,293 | $ 16,111,366 | $ 1,206,669 |
Deferred Revenue | $ 3,440,663 | $ 5,977,736 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Components of Basic and Diluted Earnings Per Share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) available to common shareholders, Net Income (loss) | $ 1,000,807 | $ 1,267,560 | $ (241,165) | $ 5,085,778 |
Net income (loss) available to common shareholders, Shares | 11,753,063 | 11,656,098 | 11,713,827 | 11,580,066 |
Net income (loss) available to common shareholders, Per Share | $ 0.09 | $ 0.11 | $ (0.02) | $ 0.44 |
Effect of dilutive securities Stock options, Shares | 4,948 | 5,686 | ||
Effect of dilutive securities Stock grants, Shares | 30,296 | |||
Diluted income (loss) per share, Net Income | $ 1,000,807 | $ 1,267,560 | $ (241,165) | $ 5,085,778 |
Diluted income (loss) per share, Shares | 11,753,063 | 11,691,342 | 11,713,827 | 11,615,310 |
Diluted income (loss) per share, Per Share | $ 0.09 | $ 0.11 | $ (0.02) | $ 0.44 |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive securities excluded from computation of earnings per share, amount | 101,790 | 101,790 | ||
Share Grants [Member] | ||||
Antidilutive securities excluded from computation of earnings per share, amount | 101,790 | 101,790 |
Other Comprehensive Income an_2
Other Comprehensive Income and Foreign Currency (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Jun. 30, 2019 | |
VLSVLHS And VLSIL Combined [Member] | |||||
Accumulated other comprehensive loss | $ (34,065,385) | $ (34,065,385) | $ (33,125,006) | ||
Net translation adjustment | $ (3,608,753) | $ (28,021) | $ (940,379) | $ (4,088,761) |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Jun. 30, 2019 | |
Accounts receivable, related parties | $ 1,332,575 | $ 1,332,575 | $ 3,266,600 | ||
NetSol-Innovation [Member] | |||||
Revenue from maintenance and services | $ 67,286 | ||||
Accounts receivable, related parties | $ 2,130,041 | $ 2,130,041 |
Major Customers (Details Narrat
Major Customers (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Jun. 30, 2019 | |
Revenue | $ 13,530,837 | $ 17,127,055 | $ 42,793,272 | $ 50,526,227 | |
Revenues in excess of billings | 15,301,150 | 15,301,150 | $ 14,719,047 | ||
Revenue in excess of billing - long term | 1,282,898 | 1,282,898 | 1,281,492 | ||
Daimler Financial Services (DFS) [Member] | |||||
Revenue | $ 11,906,959 | $ 17,137,545 | |||
Concentration risk, percentage | 27.80% | 33.90% | |||
Revenues in excess of billings | 5,982,097 | $ 5,982,097 | 4,371,081 | ||
Daimler Financial Services (DFS) [Member] | Accounts Receivable [Member] | |||||
Accounts receivable, gross | 5,186,256 | 5,186,256 | 7,917,814 | ||
BMW Financial (BMW) [Member] | |||||
Revenue | $ 6,893,438 | $ 10,339,704 | |||
Concentration risk, percentage | 16.10% | 20.50% | |||
Revenues in excess of billings | 5,365,137 | $ 5,365,137 | 5,472,043 | ||
BMW Financial (BMW) [Member] | Accounts Receivable [Member] | |||||
Accounts receivable, gross | $ 3,271,459 | $ 3,271,459 | $ 159,322 |
Convertible Note Receivable -_3
Convertible Note Receivable - Related Party (Details Narrative) - USD ($) | Aug. 19, 2019 | Apr. 02, 2019 | Mar. 31, 2020 | Sep. 09, 2019 | Jun. 30, 2019 | Feb. 09, 2018 | May 25, 2017 |
Convertible note, interest rate | 10.00% | 10.00% | 10.00% | 5.00% | |||
Convertible note, maturity date | Mar. 31, 2020 | Mar. 31, 2020 | |||||
Accrued interest | $ 604,452 | $ 328,748 | |||||
Convertible Promissory Note [Member] | |||||||
Convertible promissory note, principal amount | $ 400,000 | ||||||
Convertible note, interest rate | 10.00% | ||||||
Convertible note, maturity date | Mar. 31, 2020 | ||||||
Conversion price | $ 0.6788 | ||||||
Convertible Promissory Note [Member] | Minimum [Member] | |||||||
Conversion equity financing | $ 1,000,000 | ||||||
Convertible Promissory Note [Member] | Maximum [Member] | |||||||
Conversion equity financing | $ 1,000,000 |
Convertible Note Receivable -_4
Convertible Note Receivable - Related Party - Schedule of Convertible Note (Details) - USD ($) | Aug. 19, 2019 | Apr. 02, 2019 | Feb. 09, 2018 | May 25, 2017 | Mar. 31, 2020 |
Receivables [Abstract] | |||||
Interest Rate | 10.00% | 10.00% | 10.00% | 5.00% | |
Maturity Date, description | On Demand | On Demand | |||
Maturity Date | Mar. 31, 2020 | Mar. 31, 2020 | |||
Convertible Note Amount | $ 400,000 | $ 600,000 | $ 2,500,000 | $ 750,000 | $ 4,250,000 |
Other Current Assets - Schedule
Other Current Assets - Schedule of Other Current Assets (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid Expenses | $ 968,504 | $ 991,528 |
Advance Income Tax | 482,518 | 800,798 |
Employee Advances | 125,653 | 33,778 |
Security Deposits | 282,596 | 147,668 |
Other Receivables | 1,534,222 | 733,826 |
Other Assets | 199,872 | 438,666 |
Total | $ 3,593,365 | $ 3,146,264 |
Revenues in Excess of Billing_3
Revenues in Excess of Billings - Long Term (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended |
Mar. 31, 2020 | Mar. 31, 2020 | |
Contractors [Abstract] | ||
Accreted amount | $ 13,940 | $ 41,621 |
Interest rate discount | 4.35% |
Revenues in Excess of Billing_4
Revenues in Excess of Billings - Long Term - Schedule of Revenues in Excess of Billings (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Contractors [Abstract] | ||
Revenues in excess of billings - long term | $ 1,337,791 | $ 1,380,631 |
Present value discount | (54,893) | (99,139) |
Net Balance | $ 1,282,898 | $ 1,281,492 |
Property and Equipment (Details
Property and Equipment (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 479,350 | $ 606,641 | $ 1,429,463 | $ 1,704,606 |
Depreciation reflected in cost of revenues | $ 273,315 | $ 354,199 | $ 805,562 | $ 1,046,153 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 | Jun. 30, 2018 |
Property, Plant and Equipment [Line Items] | |||
Subtotal | $ 32,599,992 | $ 32,468,444 | |
Accumulated Depreciation | (21,046,178) | (20,371,589) | |
Property and Equipment, Net | 11,553,814 | 12,096,855 | |
Office Furniture and Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 3,132,869 | 3,125,382 | |
Computer Equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 19,077,749 | 18,905,603 | |
Assets Under Capital Leases [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 1,553,868 | 1,720,490 | |
Building [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 5,905,714 | 6,021,939 | |
Land [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 1,528,091 | 1,559,111 | |
Capital Work In Progress [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 12,899 | ||
Autos [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | 1,301,193 | 1,024,754 | |
Improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Subtotal | $ 87,609 | $ 111,165 |
Property and Equipment - Summar
Property and Equipment - Summary of Fixed Assets Held Under Finance Leases (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Capital Leased Assets [Line Items] | ||
Fixed assets held under finance leases, Total | $ 1,553,868 | $ 1,720,490 |
Less: Accumulated Depreciation - Net | (652,372) | (538,564) |
Fixed assets held under finance leases, Net | 901,496 | 1,181,926 |
Computers and Other Equipment [Member] | ||
Capital Leased Assets [Line Items] | ||
Fixed assets held under finance leases, Total | 328,998 | 324,466 |
Furniture and Fixtures [Member] | ||
Capital Leased Assets [Line Items] | ||
Fixed assets held under finance leases, Total | 51,119 | 65,084 |
Vehicles [Member] | ||
Capital Leased Assets [Line Items] | ||
Fixed assets held under finance leases, Total | $ 1,173,751 | $ 1,330,940 |
Property and Equipment - Sche_2
Property and Equipment - Schedule of Finance Lease Term (Details) | Mar. 31, 2020 |
Property, Plant and Equipment [Abstract] | |
Weighted average remaining lease term - finance leases | 1 year 7 months 24 days |
Weighted average discount rate - finance leases | 13.00% |
Leases (Details Narrative)
Leases (Details Narrative) | 3 Months Ended | 9 Months Ended |
Mar. 31, 2020USD ($) | Mar. 31, 2020USD ($) | |
Lease Agreement [Member] | ||
Operating lease termination, description | The Company is a lessor for certain office space leased by the Company and sub-leased to others under non-cancelable leases. These lease agreements provide for a fixed base rent and terminate by July 2021. All leases are considered operating leases. There are no rights to purchase the premises and no residual value guarantees. | |
Operating lease income | $ 8,514 | $ 25,227 |
Minimum [Member] | ||
Finance lease term | 1 year | 1 year |
Operating lease term | 1 year | 1 year |
Maximum [Member] | ||
Finance lease term | 10 years | 10 years |
Operating lease term | 10 years | 10 years |
Leases - Schedule of Balance Sh
Leases - Schedule of Balance Sheet Information Related to Leases (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Leases [Abstract] | ||
Operating lease assets, net | $ 2,690,777 | |
Operating lease liability, Current | 1,146,696 | |
Operating lease liability, Non-current | 1,635,866 | |
Total Lease Liabilities | $ 2,782,562 |
Leases - Schedule of Components
Leases - Schedule of Components of Lease Cost (Details) | 9 Months Ended |
Mar. 31, 2020USD ($) | |
Leases [Abstract] | |
Amortization of finance lease assets | $ 194,632 |
Interest on finance lease obligation | 71,416 |
Operating lease cost | 931,955 |
Short term lease cost | 228,869 |
Sub lease income | (25,227) |
Total lease cost | $ 1,401,645 |
Leases - Schedule of Lease Term
Leases - Schedule of Lease Term and Discount Rate (Details) | Mar. 31, 2020 |
Leases [Abstract] | |
Weighted average remaining lease term - Operating leases | 2 years 7 months 28 days |
Weighted average discount rate - Operating leases | 56.00% |
Leases - Schedule of Supplement
Leases - Schedule of Supplemental Disclosures of Cash Flow Information Related to Leases (Details) | 9 Months Ended |
Mar. 31, 2020USD ($) | |
Leases [Abstract] | |
Operating cash flows related to operating leases | $ 905,076 |
Leases - Schedule of Maturities
Leases - Schedule of Maturities of Operating Lease Liabilities (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Leases [Abstract] | ||
Within year 1 | $ 1,267,595 | |
Within year 2 | 958,385 | |
Within year 3 | 604,275 | |
Within year 4 | 132,663 | |
Within year 5 | 32,001 | |
Thereafter | 3,372 | |
Total Lease Payments | 2,998,291 | |
Less: Imputed interest | (215,729) | |
Present Value of lease liabilities | 2,782,562 | |
Less: Current portion | (1,146,696) | |
Non-Current portion | $ 1,635,866 |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments (Details) | Jun. 30, 2019USD ($) |
Leases [Abstract] | |
Within year 1 | $ 744,549 |
Within year 2 | 514,243 |
Within year 3 | 269,375 |
Within year 4 | 197,872 |
Within year 5 | 36,044 |
Total | $ 1,762,083 |
Long Term Investment (Details N
Long Term Investment (Details Narrative) - USD ($) | May 02, 2019 | Sep. 02, 2017 | Mar. 02, 2017 | Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Jun. 30, 2019 |
Share of net loss from equity investment | $ (78,502) | $ (245,389) | $ (432,522) | $ (843,373) | ||||
NetSol PK [Member] | ||||||||
Accounts receivable | 1,332,575 | 1,332,575 | $ 1,020,589 | |||||
Revenues in excess of billings - related party | 8,245 | 8,245 | $ 110,827 | |||||
NetSol PK [Member] | ||||||||
Revenue from services | 61,842 | 156,996 | 202,199 | 494,333 | ||||
Share of net loss from equity investment | $ 72,835 | $ 245,389 | $ 415,607 | $ 843,373 | ||||
Payments to acquire investment | $ 2,777,778 | |||||||
Purchase of investment, percentage | 12.20% | |||||||
WRLD3D [Member] | ||||||||
Payments for financial interest | $ 1,111,111 | |||||||
Payments to acquire investment | $ 555,555 | $ 555,556 | ||||||
WRLD3D [Member] | ||||||||
Percentage of interest in subsidiary | 4.90% | |||||||
Drivemate Agreement [Member] | Drivemate Co., Ltd. [Member] | ||||||||
Equity interest, percentage | 5.27% | 30.00% | 30.00% | |||||
Number of shares purchased | 760 | 5,469 | ||||||
Number of shares purchased, value | $ 250,000 | $ 1,800,000 | $ 1,800,000 | |||||
Revenue from services | 355,051 | 862,767 | ||||||
Share of net loss from equity investment | $ 5,667 | $ 16,915 | ||||||
Drivemate Agreement [Member] | Drivemate Co., Ltd. [Member] | Four Directors [Member] | ||||||||
Equity interest, percentage | 30.00% | 30.00% | ||||||
Drivemate Agreement [Member] | Drivemate Co., Ltd. [Member] | Final Payment [Member] | ||||||||
Number of shares purchased, value | $ 250,000 | $ 250,000 | ||||||
Remaining amount paid in increments | 62,500 | |||||||
Drivemate Agreement [Member] | Drivemate Co., Ltd. [Member] | Services [Member] | ||||||||
Number of shares purchased, value | 1,300,000 | 1,300,000 | ||||||
Drivemate Agreement [Member] | Drivemate Co., Ltd. [Member] | Cash [Member] | ||||||||
Number of shares purchased, value | $ 500,000 | $ 500,000 |
Long Term Investment - Schedule
Long Term Investment - Schedule of Long Term Investment (Details) | 9 Months Ended |
Mar. 31, 2020USD ($) | |
Initial investment | $ 4,138,889 |
Cumulative net loss on investment | (1,370,428) |
Cumulative other comprehensive income (loss) | (438,755) |
Net investment | 2,329,706 |
Drivemate Co., Ltd. [Member] | |
Initial investment | 250,000 |
Cumulative net loss on investment | (19,015) |
Cumulative other comprehensive income (loss) | |
Net investment | 230,985 |
WRLD3D, Inc. [Member] | |
Initial investment | 3,888,889 |
Cumulative net loss on investment | (1,351,413) |
Cumulative other comprehensive income (loss) | (438,755) |
Net investment | $ 2,098,721 |
Intangible Assets (Details Narr
Intangible Assets (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Jun. 30, 2019 | |
Intangible assets, net | $ 5,880,759 | $ 5,880,759 | $ 7,332,950 | ||
Product Licenses [Member] | |||||
Intangible assets, net | 5,880,759 | $ 5,880,759 | |||
Finite-lived intangible assets, amortization over period | 3 years 6 months | ||||
Amortization expenses of intangible assets | $ 464,322 | $ 520,455 | $ 1,386,092 | $ 1,646,153 |
Intangible Assets - Schedule of
Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Product Licenses - Cost | $ 47,244,997 | $ 47,244,997 |
Effect of Translation Adjustment | (15,833,112) | (15,343,727) |
Accumulated Amortization | (25,531,126) | (24,568,320) |
Net Balance | $ 5,880,759 | $ 7,332,950 |
Intangible Assets - Summary of
Intangible Assets - Summary of Estimated Amortization Expense of Intangible Assets (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
March 31, 2021 | $ 1,748,286 | |
March 31, 2022 | 1,748,286 | |
March 31, 2023 | 1,748,286 | |
March 31, 2024 | 635,901 | |
Total | $ 5,880,759 | $ 7,332,950 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses - Schedule of Accounts Payable and Accrued Expenses (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Payables and Accruals [Abstract] | ||
Accounts Payable | $ 1,711,503 | $ 1,156,498 |
Accrued Liabilities | 4,478,601 | 5,055,358 |
Accrued Payroll & Taxes | 553,223 | 793,503 |
Taxes Payable | 196,376 | 326,386 |
Other Payable | 168,230 | 144,815 |
Total | $ 7,107,933 | $ 7,476,560 |
Debts - Schedule of Components
Debts - Schedule of Components of Notes Payable and Finance Leases (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 | |
Total | $ 8,528,921 | $ 6,608,385 | |
Current Maturities | 8,475,670 | 6,541,254 | |
Long-Term Maturities | 53,251 | 67,131 | |
Subsidiary Finance Leases, Total | [1] | 571,639 | 861,784 |
Subsidiary Finance Leases, Current Maturities | [1] | 319,188 | 364,343 |
Subsidiary Finance Leases, Long-Term Maturities | [1] | 252,451 | 497,441 |
Total | 9,100,560 | 7,470,169 | |
Current Maturities | 8,794,858 | 6,905,597 | |
Long-Term Maturities | 305,702 | 564,572 | |
D&O Insurance [Member] | |||
Total | [2] | 164,731 | 67,671 |
Current Maturities | [2] | 164,731 | 67,671 |
Long-Term Maturities | [2] | ||
Bank Overdraft Facility [Member] | |||
Total | [3] | ||
Current Maturities | [3] | ||
Long-Term Maturities | [3] | ||
Loan Payable Bank - Export Refinance [Member] | |||
Total | [4] | 3,005,350 | 3,066,355 |
Current Maturities | [4] | 3,005,350 | 3,066,355 |
Long-Term Maturities | [4] | ||
Loan Payable Bank - Running Finance [Member] | |||
Total | [5] | 325,034 | |
Current Maturities | [5] | 325,034 | |
Long-Term Maturities | [5] | ||
Loan Payable Bank - Export Refinance II [Member] | |||
Total | [6] | 2,284,065 | 2,330,431 |
Current Maturities | [6] | 2,284,065 | 2,330,431 |
Long-Term Maturities | [6] | ||
Loan Payable Bank - Running Finance II [Member] | |||
Total | [7] | 735,925 | |
Current Maturities | [7] | 735,925 | |
Long-Term Maturities | [7] | ||
Loan Payable Bank - Export Refinance lll [Member] | |||
Total | [8] | 3,005,350 | |
Current Maturities | [8] | 3,005,350 | |
Long-Term Maturities | [8] | ||
Related Party Loan [Member] | |||
Total | [9] | 69,425 | 82,969 |
Current Maturities | [9] | 16,174 | 15,838 |
Long-Term Maturities | [9] | $ 53,251 | $ 67,131 |
[1] | The Company leases various fixed assets under finance lease arrangements expiring in various years through 2024. The assets and liabilities under finance leases are recorded at the lower of the present value of the minimum lease payments or the fair value of the asset. The assets are secured by the assets themselves. Depreciation of assets under finance leases is included in depreciation expense for the three months ended March 31, 2020 and 2019. | ||
[2] | The Company finances Directors' and Officers' ("D&O") liability insurance and Errors and Omissions ("E&O") liability insurance, for which the D&O and E&O balances are renewed on an annual basis and, as such, are recorded in current maturities. The interest rate on these financings were ranging from 5.0% to 7.0% as of March 31, 2020 and June 30, 2019. | ||
[3] | The Company's subsidiary, NTE, has an overdraft facility with HSBC Bank plc whereby the bank would cover any overdrafts up to £300,000, or approximately $370,370. The annual interest rate was 5.12% as of March 31, 2020. Total outstanding balance as of March 31, 2020 was £Nil. This overdraft facility requires that the aggregate amount of invoiced trade debtors (net of provisions for bad and doubtful debts and excluding intra-group debtors) of NTE, not exceeding 90 days old, will not be less than an amount equal to 200% of the facility. As of March 31, 2020, NTE was in compliance with this covenant. | ||
[4] | The Company's subsidiary, NetSol PK, has an export refinance facility with Askari Bank Limited, secured by NetSol PK's assets. This is a revolving loan that matures every nine months. Total facility amount is Rs. 500,000,000 or $3,005,350 at March 31, 2020 and Rs. 500,000,000 or $3,066,355 at June 30, 2019. The interest rate for the loan was 3% at March 31, 2020 and June 30, 2019. | ||
[5] | The Company's subsidiary, NetSol PK, has a running finance facility with Askari Bank Limited, secured by NetSol PK's assets. Total facility amount is Rs. 75,000,000 or $450,802, at March 31, 2020. NetSol PK used Rs. Nil, or $Nil at March 31, 2020. The interest rate for the loan was 13.2% and 13.0% at March 31, 2020 and June 30, 2019, respectively. This facility requires NetSol PK to maintain a long-term debt equity ratio of 60:40 and the current ratio of 1:1. As of March 31, 2020, NetSol PK was in compliance with this covenant. | ||
[6] | The Company's subsidiary, NetSol PK, has an export refinance facility with Samba Bank Limited, secured by NetSol PK's assets. This is a revolving loan that matures every nine months. Total facility amount is Rs. 380,000,000 or $2,284,065 and Rs. 380,000,000 or $2,330,431 at March 31, 2020 and June 30, 2019, respectively. The interest rate for the loan was 3% at March 31, 2020 and June 30, 2019. | ||
[7] | The Company's subsidiary, NetSol PK, has a running finance facility with Samba Bank Limited, secured by NetSol PK's assets. Total facility amount is Rs. 120,000,000 or $721,284 and Rs. 120,000,000 or $735,925, at March 31, 2020 and June 30, 2019, respectively. The interest rate for the loan was 12.9% and 14.3% at March 31, 2020 and June 30, 2019, respectively. Total outstanding balance at March 31, 2020 was Rs. Nil. During the tenure of loan, the facilities from Samba Bank Limited require NetSol PK to maintain at a minimum a current ratio of 1:1, an interest coverage ratio of 4 times, a leverage ratio of 2 times, and a debt service coverage ratio of 4 times. As of March 31, 2020, NetSol PK was in compliance with these covenants. | ||
[8] | The Company's subsidiary, NetSol PK, has an export refinance facility with Habib Metro Bank Limited, secured by NetSol PK's assets. This is a revolving loan that matures every nine months. Total facility amount is Rs. 900,000,000 or $5,409,629 and NetSol PK used Rs. 500,000,000 or $3,005,350 at March 31, 2020. The interest rate for the loan was 3% at March 31, 2020. | ||
[9] | In March 2019, the Company's subsidiary, VLS, entered into a loan agreement. The loan amount was £69,549, or $85,863, for a period of 5 years with monthly payment of £1,349, or $1,666. As of March 31, 2020, the subsidiary has used this facility up to $69,425, of which $53,251 was shown as long-term and $16,174 as current. The interest rate was 6.14% at March 31, 2020. |
Debts - Schedule of Component_2
Debts - Schedule of Components of Notes Payable and Finance Leases (Details) (Parenthetical) | Feb. 09, 2018 | May 25, 2017 | Mar. 31, 2020USD ($) | Mar. 31, 2020GBP (£) | Mar. 31, 2020GBP (£) | Mar. 31, 2020INR (₨) | Aug. 19, 2019 | Jun. 30, 2019USD ($) | Jun. 30, 2019INR (₨) | Apr. 02, 2019 |
Debt instrument, interest rate | 10.00% | 5.00% | 10.00% | 10.00% | ||||||
Debt maturity term description | On Demand | On Demand | ||||||||
Lease arrangement expiration | Years through 2024 | Years through 2024 | ||||||||
NetSol PK [Member] | Running Finance Facility [Member] | ||||||||||
Line of credit | ||||||||||
NetSol PK [Member] | INR [Member] | Running Finance Facility [Member] | ||||||||||
Line of credit | ₨ | ||||||||||
Virtual Lease Services Limited [Member] | ||||||||||
Line of credit facility, maximum borrowing capacity | 69,425 | |||||||||
Long term liabilities | 53,251 | |||||||||
Line of credit. current | $ 16,174 | |||||||||
Virtual Lease Services Limited [Member] | Investec Asset Finance [Member] | ||||||||||
Debt instrument, interest rate | 6.14% | 6.14% | 6.14% | |||||||
Line of credit | $ 85,863 | |||||||||
Line of credit, term | 5 years | 5 years | ||||||||
Line of credit monthly payments | $ 1,666 | |||||||||
Virtual Lease Services Limited [Member] | GBP [Member] | Investec Asset Finance [Member] | ||||||||||
Line of credit | £ | £ 69,549 | |||||||||
Line of credit monthly payments | £ | £ 1,349 | |||||||||
HSBC Bank [Member] | NTE [Member] | ||||||||||
Line of credit facility, maximum borrowing capacity | $ 370,370 | |||||||||
Debt instrument, interest rate | 5.12% | 5.12% | 5.12% | |||||||
Line of credit variable interest rate | 200.00% | 200.00% | ||||||||
HSBC Bank [Member] | NTE [Member] | GBP [Member] | ||||||||||
Line of credit facility, maximum borrowing capacity | £ | £ 300,000 | |||||||||
Line of credit | £ | ||||||||||
Askari Bank Limited [Member] | NetSol PK [Member] | Refinance Facility [Member] | ||||||||||
Debt instrument, interest rate | 3.00% | 3.00% | 3.00% | 3.00% | 3.00% | |||||
Line of credit | $ 3,005,350 | $ 3,066,355 | ||||||||
Debt maturity term description | Revolving loan that matures every nine months. | Revolving loan that matures every nine months. | ||||||||
Askari Bank Limited [Member] | NetSol PK [Member] | Running Finance Facility [Member] | ||||||||||
Debt instrument, interest rate | 13.20% | 13.20% | 13.20% | 13.00% | 13.00% | |||||
Line of credit | $ 450,802 | |||||||||
Long term debt covenant description | Long-term debt equity ratio of 60:40 and the current ratio of 1:1 | Long-term debt equity ratio of 60:40 and the current ratio of 1:1 | ||||||||
Askari Bank Limited [Member] | NetSol PK [Member] | INR [Member] | Refinance Facility [Member] | ||||||||||
Line of credit | ₨ | ₨ 500,000,000 | ₨ 500,000,000 | ||||||||
Askari Bank Limited [Member] | NetSol PK [Member] | INR [Member] | Running Finance Facility [Member] | ||||||||||
Line of credit | ₨ | ₨ 75,000,000 | |||||||||
Samba Bank Limited [Member] | NetSol PK [Member] | Refinance Facility [Member] | ||||||||||
Debt instrument, interest rate | 3.00% | 3.00% | 3.00% | 3.00% | 3.00% | |||||
Line of credit | $ 2,284,065 | $ 2,330,431 | ||||||||
Samba Bank Limited [Member] | NetSol PK [Member] | Running Finance Facility [Member] | ||||||||||
Debt instrument, interest rate | 12.90% | 12.90% | 12.90% | 14.30% | 14.30% | |||||
Line of credit | $ 721,284 | $ 735,925 | ||||||||
Long term debt covenant description | During the tenure of loan, the facilities from Samba Bank Limited require NetSol PK to maintain at a minimum a current ratio of 1:1, an interest coverage ratio of 4 times, a leverage ratio of 2 times, and a debt service coverage ratio of 4 times. As of March 31, 2020, NetSol PK was in compliance with these covenants. | During the tenure of loan, the facilities from Samba Bank Limited require NetSol PK to maintain at a minimum a current ratio of 1:1, an interest coverage ratio of 4 times, a leverage ratio of 2 times, and a debt service coverage ratio of 4 times. As of March 31, 2020, NetSol PK was in compliance with these covenants. | ||||||||
Samba Bank Limited [Member] | NetSol PK [Member] | INR [Member] | Refinance Facility [Member] | ||||||||||
Line of credit | ₨ | ₨ 380,000,000 | ₨ 380,000,000 | ||||||||
Samba Bank Limited [Member] | NetSol PK [Member] | INR [Member] | Running Finance Facility [Member] | ||||||||||
Line of credit | ₨ | ₨ 120,000,000 | ₨ 120,000,000 | ||||||||
Habib Metro Bank Limited [Member] | NetSol PK [Member] | Refinance Facility [Member] | ||||||||||
Debt instrument, interest rate | 3.00% | 3.00% | 3.00% | |||||||
Line of credit | $ 5,409,629 | |||||||||
Debt maturity term description | Revolving loan that matures every nine months. | Revolving loan that matures every nine months. | ||||||||
Line of credit amount used | $ 3,005,350 | |||||||||
Habib Metro Bank Limited [Member] | NetSol PK [Member] | INR [Member] | Refinance Facility [Member] | ||||||||||
Line of credit | ₨ | ₨ 900,000,000 | |||||||||
Line of credit amount used | ₨ | ₨ 500,000,000 | |||||||||
Directors and Officers Errors and Omissions Liability Insurance [Member] | ||||||||||
Line of credit facility interest rate | 5.00% | 5.00% | 5.00% | 7.00% | 7.00% |
Debts - Schedule of Aggregate M
Debts - Schedule of Aggregate Minimum Future Lease Payments Under Finance Leases (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Debt Disclosure [Abstract] | ||
Within year 1 | $ 365,384 | |
Within year 2 | 228,102 | |
Within year 3 | 19,852 | |
Within year 4 | 18,198 | |
Total Minimum Lease Payments | 631,536 | |
Interest Expense relating to future periods | (59,897) | |
Present Value of minimum lease payments | 9,100,560 | $ 7,470,169 |
Less: Current portion | 8,794,858 | 6,905,597 |
Non-Current portion | $ 305,702 | $ 564,572 |
Stockholders' Equity (Details N
Stockholders' Equity (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Mar. 31, 2020 | |
Issuance of common stock value for services | $ 176,890 | $ 145,795 | $ 342,781 | $ 89,444 | $ 416,198 | $ 446,540 | |
Officers [Member] | |||||||
Issuance of common stock shares for services | 42,818 | ||||||
Issuance of common stock value for services | $ 239,799 | ||||||
Independent Members [Member] | |||||||
Issuance of common stock shares for services | 21,615 | ||||||
Issuance of common stock value for services | $ 106,601 | ||||||
Employees [Member] | Employment Agreements [Member] | |||||||
Issuance of common stock shares under employment agreement | 62,522 | ||||||
Issuance of common stock value under employment agreement | $ 319,066 |
Incentive and Non-Statutory S_3
Incentive and Non-Statutory Stock Option Plan (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Jun. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |||||
Options outstanding and exercisable | 40,386 | 40,386 | 40,386 | ||
Compensation expense | $ 236,702 | $ 110,939 | $ 565,287 | $ 980,682 | |
Compensation expense related to unvested options yet to be recognized | $ 539,603 | $ 539,603 | |||
Stock option description | The fiscal years 2020 through 2022 |
Incentive and Non-Statutory S_4
Incentive and Non-Statutory Stock Option Plan - Schedule of Components of Common Stock Purchase Options (Details) | 9 Months Ended |
Mar. 31, 2020USD ($)$ / sharesshares | |
Share-based Payment Arrangement [Abstract] | |
Number of shares, Outstanding and Exercisable Beginning | shares | 40,386 |
Number of shares, Granted | shares | |
Number of shares, Exercised | shares | |
Number of shares, Expired / Cancelled | shares | (40,386) |
Number of shares, Outstanding and Exercisable Ending | shares | 40,386 |
Weighted Average Exercise Price, Outstanding and Exercisable Beginning | $ / shares | $ 6.50 |
Weighted Average Exercise Price, Granted | $ / shares | |
Weighted Average Exercise Price, Exercised | $ / shares | |
Weighted Average Exercise Price, Expired / Cancelled | $ / shares | 6.50 |
Weighted Average Exercise Price, Outstanding and Exercisable Ending | $ / shares | |
Weighted Average Remaining Contractual Life (in years), Outstanding and Exercisable | 7 months 10 days |
Weighted Average Remaining Contractual Life (in years), Outstanding and Exercisable Ending | 0 years |
Aggregated Intrinsic Value, Outstanding and Exercisable Beginning | $ | $ 404 |
Aggregated Intrinsic Value, Outstanding and Exercisable Ending | $ |
Incentive and Non-Statutory S_5
Incentive and Non-Statutory Stock Option Plan - Summary of Unvested Stock Grants Awarded as Compensation (Details) | 9 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Share-based Payment Arrangement [Abstract] | |
Number of shares, Unvested beginning balance | shares | 81,515 |
Number of shares, Granted | shares | 148,221 |
Number of shares, Vested | shares | (126,955) |
Number of shares, Forfeited / Cancelled | shares | (991) |
Number of shares, Unvested ending balance | shares | 101,790 |
Weighted Average Grant Date Fair Value, Unvested beginning balance | $ / shares | $ 5.88 |
Weighted Average Grant Date Fair Value, Granted | $ / shares | 5.27 |
Weighted Average Grant Date Fair Value, Vested | $ / shares | 5.24 |
Weighted Average Grant Date Fair Value, Forfeited / Cancelled | $ / shares | 6.05 |
Weighted Average Grant Date Fair Value, Unvested ending balance | $ / shares | $ 5.79 |
Operating Segments (Details Nar
Operating Segments (Details Narrative) | 9 Months Ended |
Mar. 31, 2020Number | |
Segment Reporting [Abstract] | |
Number of operating segments | 3 |
Operating Segments - Summary of
Operating Segments - Summary of Identifiable Assets (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Identifiable Assets | $ 86,406,663 | $ 87,497,019 |
Corporate Headquarters [Member] | ||
Identifiable Assets | 4,263,871 | 2,947,727 |
North America [Member] | ||
Identifiable Assets | 5,441,314 | 5,730,928 |
Europe [Member] | ||
Identifiable Assets | 9,689,483 | 8,399,033 |
Asia - Pacific [Member] | ||
Identifiable Assets | $ 67,011,995 | $ 70,419,331 |
Operating Segments - Summary _2
Operating Segments - Summary of Investment Under Equity Method (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Equity method investments | $ 2,329,706 | $ 4,138,889 |
Corporate Headquarters [Member] | ||
Equity method investments | 509,281 | 686,504 |
Asia - Pacific [Member] | ||
Equity method investments | $ 1,820,425 | $ 1,967,265 |
Operating Segments - Summary _3
Operating Segments - Summary of Operating Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues | $ 13,530,837 | $ 17,127,055 | $ 42,793,272 | $ 50,526,227 |
Net income (loss) after taxes and before non-controlling interest | 1,469,093 | 1,769,395 | (245,230) | 7,381,514 |
Intercompany Revenue [Member] | ||||
Revenues | 2,192,466 | 1,509,926 | 6,073,895 | 7,304,114 |
North America [Member] | ||||
Net income (loss) after taxes and before non-controlling interest | 134,390 | (92,029) | 230,738 | (426,209) |
Europe [Member] | ||||
Net income (loss) after taxes and before non-controlling interest | 122,974 | 330,039 | 927,717 | 735,972 |
Europe [Member] | Intercompany Revenue [Member] | ||||
Revenues | 143,814 | 120,153 | 455,040 | 416,483 |
Asia - Pacific [Member] | ||||
Net income (loss) after taxes and before non-controlling interest | 971,435 | 838,531 | (399,887) | 8,739,351 |
Asia - Pacific [Member] | Intercompany Revenue [Member] | ||||
Revenues | 2,048,652 | 1,389,773 | 5,618,855 | 6,887,631 |
Corporate Headquarters [Member] | ||||
Net income (loss) after taxes and before non-controlling interest | 240,294 | 692,854 | (1,003,798) | (1,667,600) |
Unaffiliated Customers [Member] | ||||
Revenues | 13,468,995 | 16,970,059 | 42,591,073 | 49,964,608 |
Unaffiliated Customers [Member] | North America [Member] | ||||
Revenues | 1,210,187 | 1,022,655 | 3,464,705 | 2,843,190 |
Unaffiliated Customers [Member] | Europe [Member] | ||||
Revenues | 2,791,238 | 2,405,234 | 8,225,906 | 6,425,393 |
Unaffiliated Customers [Member] | Asia - Pacific [Member] | ||||
Revenues | 9,467,570 | 13,542,170 | 30,900,462 | 40,696,025 |
Affiliated Customers [Member] | ||||
Revenues | 61,842 | 156,996 | 202,199 | 561,619 |
Affiliated Customers [Member] | Asia - Pacific [Member] | ||||
Revenues | $ 61,842 | $ 156,996 | $ 202,199 | $ 561,619 |
Operating Segments - Summary _4
Operating Segments - Summary of Capital Expenditures (Details) - USD ($) | 9 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Capital expenditures | $ 1,011,285 | $ 2,590,302 |
North America [Member] | ||
Capital expenditures | 2,404 | 1,383 |
Europe [Member] | ||
Capital expenditures | 487,693 | 461,376 |
Asia - Pacific [Member] | ||
Capital expenditures | $ 521,188 | $ 2,127,543 |
Non-Controlling Interest in S_3
Non-Controlling Interest in Subsidiary (Details Narrative) - USD ($) | 9 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Jun. 30, 2019 | |
Exercise of common stock options, shares | |||
Proceeds from stock option exercised | $ 11,621 | $ 2,650 | |
NetSol PK [Member] | |||
Non-controlling interest, percentage | 33.88% | 33.80% | |
NetSol PK [Member] | |||
Exercise of common stock options, shares | 114,000 | ||
Proceeds from stock option exercised | $ 11,261 | ||
Cash dividend | 1,610,909 | ||
NetSol Innovation [Member] | |||
Cash dividend | $ 2,778,453 |
Non-Controlling Interest in S_4
Non-Controlling Interest in Subsidiary - Schedule of Balance of Non-Controlling Interest (Details) - USD ($) | Mar. 31, 2020 | Jun. 30, 2019 |
Non-Controlling Interest | $ 6,361,553 | $ 8,414,987 |
NetSol PK [Member] | ||
Non-Controlling Interest, Percentage | 33.88% | 33.80% |
Non-Controlling Interest | $ 6,203,015 | $ 6,993,491 |
NetSol-Innovation [Member] | ||
Non-Controlling Interest, Percentage | 49.90% | 49.90% |
Non-Controlling Interest | $ 158,549 | $ 1,421,528 |
NetSol Thai [Member] | ||
Non-Controlling Interest, Percentage | 0.006% | 0.006% |
Non-Controlling Interest | $ (11) | $ (32) |