XML 28 R8.htm IDEA: XBRL DOCUMENT
v3.19.3.a.u2

Significant Accounting Policies | 9 Months Ended
--- | ---
Dec. 31, 2019
Significant Accounting Policies |
Significant Accounting Policies | 2. Significant Accounting Policies Except for the adoption of new guidance to update the requirements of financial accounting and reporting for lessees and lessors, which became effective April 1, 2019, the same accounting policies have been followed in these unaudited interim condensed consolidated financial statements as were applied in the preparation of our audited financial statements for the year ended March 31, 2019 (refer to Note 2 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended March 31, 2019), except as discussed herein. Accounting Pronouncements Adopted During the Nine Months Ended December 31, 2019 In February 2016, the FASB issued accounting guidance to update the requirements of financial accounting and reporting for lessees and lessors. The updated guidance, for lease terms of more than 12 months, requires a dual approach for lessee accounting under which a lessee accounts for leases as finance leases or operating leases. Both finance leases and operating leases under the updated guidance result in the lessee recognizing a right-of-use asset and a corresponding lease liability. For finance leases, the lessee recognizes interest expense and amortization of the right-of-use asset, and for operating leases, the lessee recognizes a straight-line total lease expense. Lessor accounting remains largely unchanged from previous guidance under U.S. GAAP. The new standard requires a modified retrospective transition approach for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief. In July 2018, the FASB issued amended guidance to provide entities with relief from the cost of implementing certain aspects of the new leasing guidance. Entities may elect not to recast comparative periods presented when transitioning to the new leasing guidance and, furthermore, lessors may elect not to separate lease and nonlease components when certain conditions are met. We adopted the amended guidance effective April 1, 2019 and applied the modified retrospective approach. Comparative information has not been restated and continues to be reported under the accounting guidance in effect for those periods. The adoption did not have a material effect on our unaudited condensed consolidated statements of operations or cash flows. We recognized operating lease right-of-use assets and operating lease liabilities related to our office leases described below on our unaudited condensed consolidated balance sheet of approximately $1.2 million as of April 1, 2019. Refer to Note 12 for a description of our operating lease expenses for the three and nine months ended December 31, 2019 and 2018 and commitments related to our leases as of December 31, 2019. We renewed an operating lease for our London office greater than 12 months during the nine months ended December 31, 2019. In relation to our time chartered-in VLGC described below, the adoption of the new guidance had no impact on our financial statements since the length of the time charter is not more than 12 months. Time charter-out contracts Our time charter revenues are generated from our vessels being hired by a third-party charterer for a specified period in exchange for consideration which is based on a monthly hire rate. The charterer has the full discretion over the ports subject to compliance with the applicable charter party agreement and relevant laws. In a time charter contract, we are responsible for all the costs incurred for running the vessel such as crew costs, vessel insurance, repairs and maintenance, and lubricants. The charterer bears the voyage related costs such as bunker expenses, port charges and canal tolls during the hire period. The performance obligations in a time charter contract are satisfied on a straight-line basis over the term of the contract beginning when the vessel is delivered to the charterer until it is redelivered back to us. The charterer generally pays the charter hire monthly in advance. We determined that our time charter contracts are considered operating leases and therefore fall under the scope of the amended guidance because (i) the vessel is an identifiable asset, (ii) we do not have substantive substitution rights, and (iii) the charterer has the right to control the use of the vessel during the term of the contract and derives the economic benefits from such use. Under the amended guidance, we elected the practical expedients available to lessors to not separate the lease and non-lease components included in the time charter revenue because (i) the pattern of revenue recognition for the lease and non-lease components is the same as it is earned by the passage of time and (ii) the lease component, if accounted for separately, would be classified as an operating lease. The adoption of the amended guidance did not impact our accounting for time charter out contracts. Time charter-in contracts We elected the practical expedient of the amended guidance that allows for contracts with an initial lease term of 12 months or less to be excluded from the operating lease right-of-use assets and lease liabilities recognized on our unaudited condensed consolidated balance sheets. The duration of our only time charter-in contract at the time of adoption of the amended guidance was 12 months. Office leases We currently have operating leases for our offices in Stamford, Connecticut, USA; London, United Kingdom; Copenhagen, Denmark; and Athens, Greece, which we determined to be operating leases and record the lease expense as part of general and administrative expenses in our unaudited condensed consolidated statements of operations. We carried forward our historical assessments of (1) whether contracts are or contain leases, (2) lease classifications, and (3) initial direct costs. For leases with terms greater than 12 months, we record the related right-of-use asset and lease liability as the present value of fixed lease payments over the lease term. For leases that do not provide a readily determinable discount rate, we use our incremental borrowing rate to discount lease payments to present value. The discount rate used ranged from 4.56% to 5.53%. The weighted average discount rate used to calculate the lease liability was 5.32%. The weighted average remaining lease term on our office leases as of December 31, 2019 is 33.1 months. Our operating lease right-of-use asset and lease liabilities as of December 31, 2019 are as follows:
Description |  | Location on Balance Sheet |  | December 31, 2019
Assets: |  |  |  |  |
Non-current |  |  |  |  |
Office Leases |  | Other non-current assets |  | $ | 1,107,262
Liabilities: |  |  |  |  |
Current |  |  |  |  |
Office Leases |  | Current portion of long-term operating leases |  | $ | 393,523
Long-term |  |  |  |  |
Office Leases |  | Other long-term liabilities |  | $ | 717,150
Maturities of operating lease liabilities as of December 31, 2019 are as follows:
Remainder FY 2020 |  | $ | 109,820
FY 2021 |  |  | 441,252
FY 2022 |  |  | 451,124
FY 2023 |  |  | 182,101
Total lease payments |  |  | 1,184,297
Less: imputed interest |  |  | (73,624)
Carrying value of lease liabilities |  | $ | 1,110,673

X
- References No definition available. + Details
Name: | us-gaap_AccountingPoliciesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for all significant accounting policies of the reporting entity. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -URI http://asc.fasb.org/topic&trid=2122369 + Details
Name: | us-gaap_SignificantAccountingPoliciesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration