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Note 6 - Investments in Joint Ventures

3 Months Ended

Nov. 30, 2023

Notes to Financial Statements

Equity Method Investments and Joint Ventures Disclosure [Text Block]

6. INVESTMENTS IN JOINT VENTURES

The consolidated financial statements of the Company’s foreign joint ventures are initially prepared using the accounting principles accepted in the respective joint ventures’ countries of domicile. Amounts related to foreign joint ventures reported in the below tables and the accompanying consolidated financial statements have subsequently been adjusted to conform with U.S. GAAP in all material respects. All material profits on sales recorded that remain on the consolidated balance sheet from the Company to its joint ventures and from joint ventures to other joint ventures have been eliminated for financial reporting purposes.

Financial information from the audited and unaudited financial statements of the Company’s joint venture in Germany, Excor Korrosionsschutz – Technologien und Produkte GmbH (EXCOR), and all the Company’s other joint ventures are summarized as follows:

		As of November 30, 2023
		Total				EXCOR				All Other
Current assets		$	58,856,062			$	28,976,285			$	29,879,777
Total assets			63,316,496				31,258,136				32,058,360
Current liabilities			13,323,941				2,674,730				10,649,211
Noncurrent liabilities			300,465				—				300,465
Joint ventures’ equity			49,692,091				28,583,406				21,108,685
NTIC’s share of joint ventures’ equity			24,599,516				14,291,705				10,307,811
NTIC’s share of joint ventures’ undistributed earnings			23,654,848				14,260,800				9,394,048

		Three Months Ended November 30, 2023
		Total				EXCOR				All Other
Net sales		$	23,560,661			$	8,420,960			$	15,139,701
Gross profit			10,103,800				4,375,075				5,728,725
Net income			2,204,482				1,026,907				1,177,575
NTIC’s share of equity in income from joint ventures			1,102,241				513,453				588,788
NTIC’s dividends received from joint ventures			371,104				—				371,104

		As of August 31, 2023
		Total				EXCOR				All Other
Current assets		$	55,339,662			$	27,862,458			$	27,477,204
Total assets			59,729,348				30,054,277				29,675,071
Current liabilities			11,464,247				2,687,064				8,777,183
Noncurrent liabilities			323,762				—				323,762
Joint ventures’ equity			47,941,339				27,367,213				20,574,126
NTIC’s share of joint ventures’ equity			23,705,714				13,683,608				10,022,106
NTIC’s share of joint ventures’ undistributed earnings			20,493,861				12,075,524				8,418,337

		Three Months Ended November 30, 2022
		Total				EXCOR				All Other
Net sales		$	24,730,289			$	10,145,921			$	14,584,368
Gross profit			9,693,568				4,720,042				4,973,526
Net income			2,646,908				1,742,287				904,621
NTIC’s share of equity in income from joint ventures			1,189,400				871,144				318,260
NTIC’s dividends received from joint ventures			3,042,688				2,459,500				583,188

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- References

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- Definition

The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 323
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (a)(3)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481687/323-10-50-3

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 323
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 3
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481687/323-10-50-3

Reference 3: http://www.xbrl.org/2003/role/recommendedDisclosureRef
-Topic 323
-SubTopic 740
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481543/323-740-50-2

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 323
-Publisher FASB
-URI https://asc.fasb.org//323/tableOfContent

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