XML 33 R22.htm IDEA: XBRL DOCUMENT
v3.21.2

DEBTS | 3 Months Ended
--- | ---
Sep. 30, 2021
Debt Disclosure [Abstract] |
DEBTS | NOTE 15 – DEBTS Notes payable and finance leases consisted of the following: SCHEDULE OF COMPONENTS OF NOTES PAYABLE AND CAPITAL LEASES
|  |  |  | As of September 30, 2021 |
|  |  |  |  |  |  | Current |  |  | Long-Term |
Name |  |  |  | Total |  |  | Maturities |  |  | Maturities |
D&O Insurance |  | (1) |  | $ | 26,452 |  |  | $ | 26,452 |  |  | $ | - |
Bank Overdraft Facility |  | (2) |  |  | - |  |  |  | - |  |  |  | - |
Term Finance Facility |  | (3) |  |  | 1,270,755 |  |  |  | 990,623 |  |  |  | 280,132 |
Loan Payable Bank - Export Refinance |  | (4) |  |  | 2,924,661 |  |  |  | 2,924,661 |  |  |  | - |
Loan Payable Bank - Running Finance |  | (5) |  |  | - |  |  |  | - |  |  |  | - |
Loan Payable Bank - Export Refinance II |  | (6) |  |  | 2,222,742 |  |  |  | 2,222,742 |  |  |  | - |
Loan Payable Bank - Running Finance II |  | (7) |  |  | - |  |  |  | - |  |  |  | - |
Loan Payable Bank - Export Refinance III |  | (8) |  |  | 4,094,525 |  |  |  | 4,094,525 |  |  |  | - |
Sale and Leaseback Financing |  | (9) |  |  | 73,117 |  |  |  | 26,063 |  |  |  | 47,054 |
Term Finance Facility |  | (10) |  |  | 49,021 |  |  |  | 19,408 |  |  |  | 29,613 |
Insurance Financing |  | (11) |  |  | 45,198 |  |  |  | 45,198 |  |  |  | - |
|  |  |  |  | 10,706,471 |  |  |  | 10,349,672 |  |  |  | 356,799 |
Subsidiary Finance Leases |  | (12) |  |  | 113,515 |  |  |  | 73,543 |  |  |  | 39,972 |
|  |  |  | $ | 10,819,986 |  |  | $ | 10,423,215 |  |  | $ | 396,771 |
|  |  |  | As of June 30, 2021 |
|  |  |  |  |  |  | Current |  |  | Long-Term |
Name |  |  |  | Total |  |  | Maturities |  |  | Maturities |
D&O Insurance |  | (1) |  | $ | 73,143 |  |  | $ | 73,143 |  |  | $ | - |
Bank Overdraft Facility |  | (2) |  |  | - |  |  |  | - |  |  |  | - |
Term Finance Facility |  | (3) |  |  | 1,648,818 |  |  |  | 1,090,259 |  |  |  | 558,559 |
Loan Payable Bank - Export Refinance |  | (4) |  |  | 3,162,555 |  |  |  | 3,162,555 |  |  |  | - |
Loan Payable Bank - Running Finance |  | (5) |  |  | - |  |  |  | - |  |  |  | - |
Loan Payable Bank - Export Refinance II |  | (6) |  |  | 2,403,542 |  |  |  | 2,403,542 |  |  |  | - |
Loan Payable Bank - Running Finance II |  | (7) |  |  | - |  |  |  | - |  |  |  | - |
Loan Payable Bank - Export Refinance III |  | (8) |  |  | 4,427,578 |  |  |  | 4,427,578 |  |  |  | - |
Sale and Leaseback Financing |  | (9) |  |  | 85,313 |  |  |  | 28,183 |  |  |  | 57,130 |
Term Finance Facility |  | (10) |  |  | 55,182 |  |  |  | 19,644 |  |  |  | 35,538 |
Insurance Financing |  | (11) |  |  | 41,774 |  |  |  | 41,774 |  |  |  | - |
|  |  |  |  | 11,897,905 |  |  |  | 11,246,678 |  |  |  | 651,227 |
Subsidiary Finance Leases |  | (12) |  |  | 168,107 |  |  |  | 119,493 |  |  |  | 48,614 |
|  |  |  | $ | 12,066,012 |  |  | $ | 11,366,171 |  |  | $ | 699,841 |
(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 September 30, 2021 and June 30, 2021.
(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 $405,405. The annual interest rate was 5.12% as of September 30, 2021. The total outstanding balance as of September 30, 2021 was £Nil.
NETSOL TECHNOLOGIES, INC. Notes to Condensed Consolidated Financial Statements September 30, 2021 (Unaudited)
| 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 September 30, 2021, NTE was in compliance with this covenant.
(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 $405,405. The annual interest rate was 5.12% as of September 30, 2021. The total outstanding balance as of September 30, 2021 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 September 30, 2021, NTE was in compliance with this covenant.
(3) | The Company’s subsidiary, NetSol PK, has a term finance facility from Askari Bank Limited, approved by the Government of Pakistan to protect the employment situation during the COVID-19 pandemic. This is a term loan payable in three years. The availed facility amount was Rs. 217,248,351 or $1,270,755, at September 30, 2021, of which $990,623 is shown as current and the remaining $280,132 is shown as long term. The availed facility amount was Rs. 260,678,818 or $1,648,818, at June 30, 2021, of which $1,090,259 is shown as current and the remaining $558,559 is shown as long term. The interest rate for the loan was 3% at September 30, 2021 and June 30, 2021.
(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. The total facility amount is Rs. 500,000,000 or $2,924,661 at September 30, 2021 and Rs. 500,000,000 or $3,162,555 at June 30, 2021. The interest rate for the loan was 3% at September 30, 2021 and June 30, 2021.
(5) | The Company’s subsidiary, NetSol PK, has a running finance facility with Askari Bank Limited, secured by NetSol PK’s assets. The total facility amount is Rs. 75,000,000 or $438,699, at September 30, 2021. The balance outstanding at September 30, 2021 and June 30, 2021 was Rs. Nil. The interest rate for the loan was 9.8% and 9.5% at September 30, 2021 and June 30, 2021, 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 September 30, 2021, NetSol PK was in compliance with this covenant.
(5) | The Company’s subsidiary, NetSol PK, has a running finance facility with Askari Bank Limited, secured by NetSol PK’s assets. The total facility amount is Rs. 75,000,000 or $438,699, at September 30, 2021. The balance outstanding at September 30, 2021 and June 30, 2021 was Rs. Nil. The interest rate for the loan was 9.8% and 9.5% at September 30, 2021 and June 30, 2021, 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 September 30, 2021, 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. The total facility amount is Rs. 380,000,000 or $2,222,742 and Rs. 380,000,000 or $2,403,542 at September 30, 2021 and June 30, 2021, respectively. The interest rate for the loan was 3% at September 30, 2021 and June 30, 2021.
(7) | The Company’s subsidiary, NetSol PK, has a running finance facility with Samba Bank Limited, secured by NetSol PK’s assets. The total facility amount is Rs. 120,000,000 or $701,919 and Rs. 120,000,000 or $759,013, at September 30, 2021 and June 30, 2021, respectively. The interest rate for the loan was 9.3% and 9.0% at September 30, 2021 and June 30, 2021, respectively. The balance outstanding at September 30, 2021 and June 30, 2021 was Rs. Nil.
| During the tenure of the 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 September 30, 2021, NetSol PK was in compliance with these covenants.
(7) | The Company’s subsidiary, NetSol PK, has a running finance facility with Samba Bank Limited, secured by NetSol PK’s assets. The total facility amount is Rs. 120,000,000 or $701,919 and Rs. 120,000,000 or $759,013, at September 30, 2021 and June 30, 2021, respectively. The interest rate for the loan was 9.3% and 9.0% at September 30, 2021 and June 30, 2021, respectively. The balance outstanding at September 30, 2021 and June 30, 2021 was Rs. Nil. During the tenure of the 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 September 30, 2021, 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 $5,264,389 and Rs. 900,000,000 or $5,692,600, at September 30, 2021 and June 30, 2021, respectively. NetSol PK used Rs. 700,000,000 or $4,094,525 and Rs. 700,000,000 or $4,427,578, at September 30, 2021 and June 30, 2021, respectively. The interest rate for the loan was 3% at September 30, 2021 and June 30, 2021.
(9) | The Company’s subsidiary, NetSol PK, availed sale and leaseback financing from First Habib Modaraba secured by the transfer of the vehicles’ title. As of June 30, 2021, NetSol PK used Rs. 12,499,891 or $73,117 of which $47,054 was shown as long term and $26,063 as current. As of June 30, 2021, NetSol PK used Rs. 13,487,949 or $85,313 of which $57,130 was shown as long term and $28,183 as current. The interest rate for the loan was 9.0% at September 30, 2021, and June 30, 2021.
(10) | In March 2020, the Company’s subsidiary, VLS, entered into a loan agreement. The loan amount was £69,549, or $93,985, for a period of 5 years with monthly payments of £1,349, or $1,823. As of September 30, 2021, the subsidiary has used this facility up to $49,021, of which $29,613 was shown as long-term and $19,408 as current. As of June 30, 2021, the subsidiary has used this facility up to $55,182, of which $35,538 was shown as long-term and $19,644 as current. The interest rate was 6.14% at September 30, 2021 and June 30, 2021.
NETSOL TECHNOLOGIES, INC. Notes to Condensed Consolidated Financial Statements September 30, 2021 (Unaudited)
(11) | The Company’s subsidiary, VLS, finances Directors’ and Officers’ (“D&O”) liability insurance, and the $45,198 and $41,774 was recorded in current maturities, at September 30, 2021 and June 30, 2021, respectively. The interest rate on this financing ranged from 9.7% to 12.7% as of September 30, 2021 and was 9.7% as of June 30, 2021.
(12) | 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 September 30, 2021 and 2020.
Following is the aggregate minimum future lease payments under finance leases as of September 30, 2021: SCHEDULE OF AGGREGATE FUTURE LONG TERM DEBT PAYMENTS
|  | Amount |
Minimum Lease Payments |  |  |  |
Within year 1 |  | $ | 77,806 |
Within year 2 |  |  | 30,102 |
Within year 3 |  |  | 11,845 |
Total Minimum Lease Payments |  |  | 119,753 |
Interest Expense relating to future periods |  |  | (6,238 | )
Present Value of minimum lease payments |  |  | 113,515 |
Less: Current portion |  |  | (73,543 | )
Non-Current portion |  | $ | 39,972 |

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

X
- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (h) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(c)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (g) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1C -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1E -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1I -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 20 -Section 50 -Paragraph 1B -Subparagraph (i) -URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611 + Details
Name: | us-gaap_DebtDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration