XML 24 R14.htm IDEA: XBRL DOCUMENT v3.23.3
Fair Value Disclosures
 6 Months Ended
Sep. 30, 2023
Fair Value Disclosures [Abstract]  
Fair Value Disclosures

Note 8. Fair Value Disclosures

The Company’s financial instruments consist of cash, finance receivables, and the WL Credit Facility, none of which are carried at fair value.

Fair value is defined in FASB, ASC Topic 820-10-20 as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” Fair value also assumes that the reporting entity would sell the asset or transfer the liability in the principal or most advantageous market.

Market participants are defined as buyers and sellers in the principal (or most advantageous) market for the asset or liability that have all of the following characteristics: 1) an unrelated party; 2) knowledgeable (having a reasonable understanding about the asset or liability and the transaction based on all available information; including information that might be obtained through due diligence efforts that are usual or customary); 3) able to transact; and 4) willing to transact (motivated but not forced or otherwise compelled to do so).

The FASB states that “valuation techniques that are appropriate in the circumstances and for which sufficient data are available shall be used to measure fair value.” The valuation techniques for measuring fair value are consistent with the three traditional approaches to value: the market approach, the income approach, and the cost or asset approach. The application of valuation techniques requires the use of common sense, informed judgment, and reasonableness based on the relevant facts and circumstances surrounding the analysis. There are relevant inputs (both observable and unobservable) can be used in valuation based on the facts and circumstances. The FASB has defined a fair value hierarchy for these inputs which prioritizes the inputs into three broad levels:

•Level 1 inputs are defined as quoted prices (unadjusted) in active markets for identical assets or liabilities.

•Level 2 inputs are defined as inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

•Level 3 inputs are defined as unobservable inputs for the asset or liability.

Unobservable inputs should be used only to the extent that relevant observable inputs are not available; this allows for situations where there is little, if any, market activity for the asset or liability at the measurement date. Unobservable inputs should reflect the reporting entity’s own assumptions about the assumptions that market participants would use in pricing the asset or liability (including assumptions about risk).

The initial terms of the Contracts generally range from 12 to 72 months. Beginning in December 2017, the maximum initial term of a Contract was reduced to 60 months. The initial terms of the Direct Loans generally range from 12 to 60 months. If liquidated outside of the normal course of business, the amount received may not be the carrying value.

Repossessed assets, which are not financial instruments, are valued at the lower of the finance receivable balance prior to repossession or the estimated net realizable value of the repossessed asset. The Company estimates the net realizable value using estimated auction wholesale proceeds less costs to sell plus insurance claims outstanding, if any.

 

Based on current market conditions, the fair value of the WL Credit Facility as of September 30, 2023 was estimated to be equal to the book value. The interest rate for the WL Credit Facility is a variable rate based on SOFR pricing options.

 

 

 

(In thousands)

 

 

 

Fair Value Measurement Using

 

 

 

 

 

 

 

Description

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Fair
Value

 

 

Carrying
Value

 

Cash:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2023

 

$

651

 

 

$

-

 

 

$

-

 

 

$

651

 

 

$

651

 

March 31, 2023

 

$

454

 

 

$

-

 

 

$

-

 

 

$

454

 

 

$

454

 

Finance receivables:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2023

 

$

-

 

 

$

-

 

 

$

67,187

 

 

$

67,187

 

 

$

72,153

 

March 31, 2023

 

$

-

 

 

$

-

 

 

$

105,971

 

 

$

105,971

 

 

$

106,919

 

Repossessed assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2023

 

$

-

 

 

$

-

 

 

$

1,457

 

 

$

1,457

 

 

$

1,457

 

March 31, 2023

 

$

-

 

 

$

-

 

 

$

1,491

 

 

$

1,491

 

 

$

1,491

 

Credit Facility:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 2023

 

$

-

 

 

$

-

 

 

$

3,850

 

 

$

3,850

 

 

$

3,850

 

March 31, 2023

 

$

-

 

 

$

-

 

 

$

29,100

 

 

$

29,100

 

 

$

29,100

 

 

The Company may be required, from time to time, to measure certain assets and liabilities at fair value on a nonrecurring basis. There were none required at September 30, 2023 and March 31, 2023.