Leases

6 Months Ended

Dec. 31, 2019

18. Leases

The Company elected to adopt the new lease guidance utilizing the modified retrospective approach therefore prior periods were not adjusted. The Company was not required to record a cumulative-effect adjustment to opening retained earnings as of July 1, 2019. The Company applied the package of three practical expedients available, which included the following (i) an entity need not reassess expired or existing contracts which are or contain leases (ii) an entity need not reassess the lease classification for any expired or existing leases, and (iii) an entity need not reassess initial direct costs for any existing leases. The Company also elected to not recognize right-of-use assets and lease liabilities for leases with a term of less than twelve months and to account for all components in a lease arrangement as a single combined lease component.

The Company has entered into leasing arrangements classified as operating leases under accounting guidance. These leasing arrangements relate primarily to the lease of our corporate head office, administration offices and branch locations through which the Company operates its financial services business in South Africa. The Company’s operating leases have a remaining lease term of between one to five years. We also operate parts of our financial services business from locations which we lease for a period of less than one year. The Company’s operating lease expense during the three and six months ended December 31, 2019, was $1.1 million and $2.0 million, respectively. The Company does not have any significant leases that have not commenced as of December 31, 2019.

The following table presents supplemental balance sheet disclosure related to our right-of-use assets and our operating lease liabilities as of December 31, 2019 and July 1, 2019, the date of adoption of the new lease guidance (refer to Note 1):

	December 31,			July 1,
		2019		2019
Operating lease right-of-use	$	7 838	$	6 739
Weighted average remaining lease term (years)		3,60		2,51
Weighted average discount rate		10%		10%

Maturities of operating lease liabilities
2020 (for December 31, 2019 excluding six months to December 31, 2019)	$	2 334	$	3 608
2021		3 281		2 395
2022		1 850		1 269
2023		1 011		454
2024		598		-
Thereafter		204		-
Total undiscounted operating lease liabilities		9 278		7 726
Less imputed interest		1 245		842
Total operating lease liabilities, included in		8 033		6 884
Operating lease right-of-use lease liability - current		3 534		5 098
Right-of-use operating lease liability - long-term	$	4 499	$	1 786