Registration statement for securities of certain foreign private issuers

RIGHT OF USE ASSET AND LEASE LIABILITY

v3.23.3
RIGHT OF USE ASSET AND LEASE LIABILITY
 6 Months Ended 12 Months Ended
Jun. 30, 2023
Dec. 31, 2022
Notes and other explanatory information [abstract]    
RIGHT OF USE ASSET AND LEASE LIABILITY

NOTE 8 — RIGHT OF USE ASSET AND LEASE LIABILITY

 

Net carrying amounts of right-of-use assets

 

The carrying amounts of right-of-use assets are as follows:

 

   

As of

June 30, 2023

    

As of

December 31, 2022

  
Right of use asset – Buildings   $ 2,541,123     $ 2,541,123  
Right of use asset – Buildings (related party)     11,149,101       11,149,101  
Right of use asset – Leasehold     992,410       992,410  
Right of use asset – Office space     58,412       58,412  
Foreign currency translation     (93,961 )     (119,182 )
Accumulated depreciation of right of use assets     (1,751,347 )     (1,723,114 )
Accumulated depreciation of right of use assets (related party)     (551,051 )     (325,040 )
Right of use asset   $ 12,344,687     $ 12,573,710  

 

During the half year ended June 30, 2023, the Company recorded depreciation of right-of-use assets of $254,244 (June 2022 — $245,035).

 

Lease liabilities

 

The maturity analysis of lease liabilities is as follows:

 

    As of June 30 2023    

As of

December 31, 2022

  
Within one year   $ 1,702,541     $ 1,664,966  
Two to five years     6,144,383       6,280,716  
Thereafter     16,280,925       17,871,937  
Gross lease liabilities     24,127,849       25,817,619  
Less: Finance Charges component     (11,365,196 )     (12,832,744 )
Lease liabilities   $ 12,762,653     $ 12,984,875  
                 
Lease liabilities – Current   $ 1,325,839     $ 1,590,538  
Lease liabilities - Non-Current     11,436,814       11,394,337  
Lease liabilities   $ 12,762,653     $ 12,984,875  

 

NOTE 10 — RIGHT OF USE ASSET AND LEASE LIABILITY

 

Net carrying amounts of right-of-use assets

 

The carrying amounts of right-of-use assets are as follows:

 

    2022     2021  
    As of December 31,  
    2022     2021  
Right of use asset – Buildings   $ 2,541,123     $ 1,378,312  
Right of use asset – Buildings (related party)     11,149,101       -  
Right of use asset – Leasehold     992,410       992,410  
Right of use asset – Office space     58,412       58,412  
Foreign currency translation     (119,182 )     (117,959 )
Accumulated depreciation of right of use assets     (1,723,114 )     (1,233,934 )
Accumulated depreciation of right of use assets (related party)     (325,040 )     -  
  Right of use asset   $ 12,573,710     $ 1,077,241  

 

During the year ended December 31, 2022, the Company recorded depreciation of right-of-use assets of $814,220 (2021 — $507,688).

 

During July 2022, the Company signed two lease agreements for University of Antelope Valley’s buildings with the former owners, a related party, both with 12-year terms. A right of use asset and a lease liability of $11,149,101 was booked to the Consolidated Statements of Financial Condition for the leases.

 

Lease liabilities

 

The maturity analysis of lease liabilities is as follows:

 

                 
    As of December 31,  
    2022     2021  
Within one year   $ 1,664,966     $ 436,270  
Two to five years     6,280,716       298,594  
Thereafter     17,871,937       9,007,645  
 Gross lease liabilities     25,817,619       9,742,509  
Less: Finance Charges component     (12,832,744 )     (8,411,649 )
 Lease liabilities   $ 12,984,875     $ 1,330,860  
                 
Lease liabilities – Current   $ 1,590,538     $ 436,271  
Lease liabilities - Non-Current     11,394,337       894,589  
 Lease liabilities   $ 12,984,875     $ 1,330,860  

 

The weighted average discount rate utilized to calculate the present value of the lease liabilities was 7.71%. The average remaining life of the leases is 22 years.