XML 21 R10.htm IDEA: XBRL DOCUMENT
v3.21.2

Leases | 6 Months Ended
--- | ---
Jun. 30, 2021
Leases Of Lessees Disclosure [Abstract] |
LEASES | 4. LEASES Refer to Note 2 to these consolidated financial statements for further information about the Company’s revenue generating activities as a lessor. All the Company’s customer agreements are considered operating leases, and the Company currently does not have any sales-type or direct financing leases. Lease Commitments In August 2017, FlexShopper entered into a 12-month lease with two additional three-year options for retail store space in West Palm Beach, Florida. In April 2018, FlexShopper exercised its option to extend the term of the lease to September 30, 2021. In March 2021, FlexShopper and the lessor agreed on the early termination of the lease for this property. The monthly rent for this space was approximately $2,300 per month. In January 2019, FlexShopper entered into a 108-month lease with an option for one additional five-year term for 21,622 square feet of office space in Boca Raton, FL to accommodate FlexShopper’s business and its employees (the “January 2019 Lease”). The monthly rent for this space is approximately $31,500 with annual three percent increases throughout the initial 108-month lease term beginning on the anniversary of the commencement date. The rental expense for the six months ended June 30, 2021 and 2020 was approximately $324,000 and $353,000 respectively. At June 30, 2021, the future minimum annual lease payments are approximately as follows:
2021 |  | $ | 204,000 |
2022 |  |  | 417,000 |
2023 |  |  | 427,000 |
2024 |  |  | 435,000 |
2025 |  |  | 443,000 |
Thereafter |  |  | 1,230,000 |
|  | $ | 3,156,000 |
The Company determines if an arrangement is a lease at inception. Operating lease assets and liabilities are included in the Company’s consolidated balance sheets beginning January 1, 2019. The breakout of operating lease assets, and current and non-current operating lease liabilities at June 30, 2021, is shown in the table below. Supplemental balance sheet information related to leases is as follows:
|  | Balance Sheet Classification |  | June 30, 2021 |  |  | December 31, 2020 |
Assets |  |  |  |  |  |  |  |
Operating Lease Asset |  | Property and Equipment, net |  | $ | 1,596,454 |  |  | $ | 1,673,432 |
Finance Lease Asset |  | Property and Equipment, net |  |  | 22,962 |  |  |  | 27,106 |
Total Lease Assets |  |  |  | $ | 1,619,416 |  |  | $ | 1,700,538 |
Liabilities |  |  |  |  |  |  |  |  |  |
Operating Lease Liability - current portion |  | Current Lease Liabilities |  | $ | 147,912 |  |  | $ | 153,019 |
Finance Lease Liability - current portion |  | Current Lease Liabilities |  |  | 8,232 |  |  |  | 7,707 |
Operating Lease Liability - net of current portion |  | Long Term Lease Liabilities |  |  | 1,848,157 |  |  |  | 1,925,498 |
Finance Lease Liability - net of current portion |  | Long Term Lease Liabilities |  |  | 17,605 |  |  |  | 21,857 |
Total Lease Liabilities |  |  |  | $ | 2,021,906 |  |  | $ | 2,108,081 |
Operating lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The Company uses its incremental borrowing rate as the discount rate for its leases, as the implicit rate in the lease is not readily determinable. The incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. Operating lease assets also include any prepaid lease payments and lease incentives. The lease terms include periods under options to extend or terminate the lease when it is reasonably certain that the Company will exercise the option. The Company generally uses the base, non-cancelable, lease term when determining the lease assets and liabilities. Under the short-term lease exception provided within ASC 842, the Company does not record a lease liability or right-of-use asset for any leases that have a lease term of 12 months or less at commencement. Below is a summary of the weighted-average discount rate and weighted-average remaining lease term for the Company’s leases:
|  | Weighted Average Discount Rate |  |  | Weighted Average Remaining Lease Term (in years) |
Operating Leases |  |  | 13.03 | % |  |  | 7 |
Finance Leases |  |  | 13.31 | % |  |  | 3 |
Operating lease expense is recognized on a straight-line basis over the lease term within operating expenses in the Company’s consolidated statements of operations. Finance lease expense is recognized over the lease term within interest expense and amortization in the Company’s consolidated statements of operations. The Company’s total operating and finance lease expense all relate to lease costs and amounted to $201,171 and $219,767 for the six months ended June 30, 2021 and June 30, 2020, respectively. Supplemental cash flow information related to operating leases is as follows:
|  | Six Months ended |
|  | June 30, |
|  | 2021 |  |  | 2020 |
Cash payments for operating leases |  | $ | 202,007 |  |  | $ | 14,454 |
Cash payments for finance leases |  |  | 5,592 |  |  |  | 5,547 |
New finance lease asset obtained in exchange for lease liabilities |  |  | - |  |  |  | 4,033 |
Below is a summary of undiscounted operating lease liabilities as of June 30, 2021. The table also includes a reconciliation of the future undiscounted cash flows to the present value of the operating lease liabilities included in the consolidated balance sheet.
|  | Operating Leases |
2021 |  | $ | 198,766 |
2022 |  |  | 405,443 |
2023 |  |  | 417,606 |
2024 |  |  | 430,134 |
2025 |  |  | 443,038 |
2026 and thereafter |  |  | 1,229,925 |
Total undiscounted cash flows |  |  | 3,124,912 |
Less: interest |  |  | (1,128,843 | )
Present value of lease liabilities |  | $ | 1,996,069 |
Below is a summary of undiscounted finance lease liabilities as of June 30, 2021. The table also includes a reconciliation of the future undiscounted cash flows to the present value of the finance lease liabilities included in the consolidated balance sheet.
|  | Finance Leases |
2021 |  | $ | 5,592 |
2022 |  |  | 11,184 |
2023 |  |  | 9,699 |
2024 |  |  | 4,781 |
Total undiscounted cash flows |  |  | 31,256 |
Less: interest |  |  | (5,419 | )
Present value of lease liabilities |  | $ | 25,837 |

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

X
- Definition The entire disclosure for lessee. + References No definition available. + Details
Name: | fpay_LeasesOfLesseesDisclosureTextBlock
Namespace Prefix: | fpay_
Data Type: | dtr:textBlockItemType
Balance Type: | na
Period Type: | duration