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10. LEASES | 3 Months Ended
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Dec. 31, 2020
Leases [Abstract] |
10. LEASES | 10. LEASES Effective October 1, 2019, the Company accounts for its leases under ASC 842, which requires lessees to recognize lease assets and liabilities arising from operating leases on the balance sheet. The Company adopted the new lease guidance using the modified retrospective approach and elected the transition option issued under ASU 2018-11, Leases (Topic 842) Targeted Improvements, allowing entities to continue to apply the legacy guidance in ASC 840, Leases, to prior periods, including disclosure requirements. Accordingly, prior period financial results and disclosures have not been adjusted. The Company has operating leases under which it leases its branch offices, corporate headquarters and data center, one of which is with a related party. As of December 31, 2020, the Company's operating lease right of use asset and operating lease liability totaled $865,441 and $865,441, respectively. A weighted average discount rate of 10% was used in the measurement of the right of use asset and lease liability. As the rate implicit in the lease is not readily determinable, the Company's incremental collateralized borrowing rate is used to determine the present value of lease payments. This rate gives consideration to the applicable Company collateralized borrowing rates and is based on the information available at the commencement date. The Company has elected to apply the short-term lease measurement and recognition exemption to leases with an initial term of 12 months or less; therefore, these leases are not recorded on the Company’s Consolidated Balance Sheet, but rather, lease expense is recognized over the lease term on a straight-line basis. The Company's operating leases have remaining lease terms between one year to two years, with a weighted average lease term of 1.39 years at December 31, 2020. Some leases include multiple year renewal options. The Company’s decision to exercise these renewal options is based on an assessment of its current business needs and market factors at the time of the renewal. Currently, the Company has no leases for which the option to renew is reasonably certain and therefore, options to renew were not factored into the calculation of its right of use asset and lease liability as of December 31, 2020. These operating leases also have a weighted average discount rate of 10% at December 31, 2020. The following is a schedule of the Company's operating lease liabilities by contractual maturity as of December 31, 2020:
Fiscal year ending September 30, 2021 |  |  | 506,880
Fiscal year ending September 30, 2022 |  |  | 420,904
Total Lease Payments |  |  | 930,545
Less: imputed interest |  |  | (62,343)
Total present value of lease liabilities |  | $ | 865,441
Total operating lease costs of $117,223 and $21,318 for the three months ended December 31, 2020 and 2019, respectively, were included as part of administrative expense. The Company has financing leases in relation to the equipment used at its data center. The following is a schedule of the Company’s financing lease liabilities by contractual maturity as of December 31, 2020:
Fiscal year ending September 30, 2021 |  |  | 303,988
Fiscal year ending September 30, 2022 |  |  | 405,317
Fiscal year ending September 30, 2023 |  |  | 312,781
Fiscal year ending September 30, 2024 |  |  | 127,784
Total Lease Payments |  |  | 1,149,870
Less: imputed interest |  |  | (158,486)
Total present value of lease liabilities |  | $ | 991,384
These financing leases have a weighted average lease term of 3.02 years and a weighted average discount rate of 8.6% at December 31, 2020.

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- Definition The entire disclosure for lessee entity's leasing arrangements including, but not limited to, all of the following: (a.) The basis on which contingent rental payments are determined, (b.) The existence and terms of renewal or purchase options and escalation clauses, (c.) Restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing. + References Reference 1: http://fasb.org/us-gaap/role/ref/otherTransitionRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -URI http://asc.fasb.org/topic&trid=2208923 + Details
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