Quarterly report pursuant to Section 13 or 15(d)

Debts - Schedule of Components of Notes Payable and Finance Leases (Details)

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Debts - Schedule of Components of Notes Payable and Finance Leases (Details) - USD ($)
Dec. 31, 2020
Jun. 30, 2020
Total $ 11,454,627 $ 10,210,130
Current Maturities 9,960,714 8,847,487
Long-Term Maturities 1,493,913 1,362,643
Subsidiary Finance Leases, Total [1] 483,262 469,406
Subsidiary Finance Leases, Current Maturities [1] 422,858 292,074
Subsidiary Finance Leases, Long-Term Maturities [1] 60,404 177,332
Total 11,937,889 10,679,536
Current Maturities 10,383,572 9,139,561
Long-Term Maturities 1,554,317 1,539,975
D&O Insurance [Member]    
Total [2] 142,582 81,728
Current Maturities [2] 142,582 81,728
Long-Term Maturities [2]
Paycheck Protection Program Loans [Member]    
Total [3] 469,721 469,721
Current Maturities [3] 339,243 182,669
Long-Term Maturities [3] 130,478 287,052
Bank Overdraft Facility [Member]    
Total [4]
Current Maturities [4]
Long-Term Maturities [4]
Term Finance Facility [Member]    
Total [5] 2,168,714 1,380,878
Current Maturities [5] 850,166 354,337
Long-Term Maturities [5] 1,318,548 1,026,541
Loan Payable Bank - Export Refinance [Member]    
Total [6] 3,119,541 2,975,482
Current Maturities [6] 3,119,541 2,975,482
Long-Term Maturities [6]
Loan Payable Bank - Running Finance [Member]    
Total [7]
Current Maturities [7]
Long-Term Maturities [7]
Loan Payable Bank - Export Refinance II [Member]    
Total [8] 2,370,850 2,261,365
Current Maturities [8] 2,370,850 2,261,365
Long-Term Maturities [8]
Loan Payable Bank - Running Finance II [Member]    
Total [9]
Current Maturities [9]
Long-Term Maturities [9]
Loan Payable Bank - Export Refinance lll [Member]    
Total [10] 3,119,542 2,975,483
Current Maturities [10] 3,119,542 2,975,483
Long-Term Maturities [10]
Term Finance Facility [Member]    
Total [11] 63,677 65,473
Current Maturities [11] 18,790 16,423
Long-Term Maturities [11] $ 44,887 $ 49,050
[1] 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 and six months ended December 31, 2020 and 2019.
[2] 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 December 31, 2020 and June 30, 2020.
[3] The Company and its subsidiary, NTA, received Paycheck Protection Program loans of $469,721 introduced by the U.S. Government during the COVID-19 Pandemic. This loan is forgivable if the Company meets the criteria set by the U.S. Government. The loans carry an interest rate of 1% and have a maturity date of two years from the date of the disbursement of the loan. As of December 31, 2020, the Company has not applied for the loan forgiveness.
[4] 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 $410,959. The annual interest rate was 5.12% as of December 31, 2020. The total outstanding balance as of December 31, 2020 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 December 31, 2020, NTE was in compliance with this covenant.
[5] 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 Pandemic COVID-19. This is a term loan payable in three years. The availed facility amount was Rs. 347,601,639 or $2,168,714, at December 31, 2020, of which $850,166 is shown as current and the remaining $1,318,548 is shown as long term. The availed facility amount was Rs. 232,042,664 or $1,380,878, at June 30, 2020, of which $354,337 is shown as current and the remaining $1,026,541 is shown as long term. The interest rate for the loan was 3% at December 31, 2020 and June 30, 2020.
[6] 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 $3,119,541 at December 31, 2020 and Rs. 500,000,000 or $2,975,482 at June 30, 2020. The interest rate for the loan was 3% at December 31, 2020 and June 30, 2020.
[7] 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 $467,931, at December 31, 2020. The balance outstanding at December 31, 2020 and June 30, 2020 was Rs. Nil. The interest rate for the loan was 9.29% and 7.2% at December 31, 2020 and June 30, 2020, 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 December 31, 2020, NetSol PK was in compliance with this covenant.
[8] 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 $2,370,851 and Rs. 380,000,000 or $2,261,366 at December 31, 2020 and June 30, 2020, respectively. The interest rate for the loan was 3% at December 31, 2020 and June 30, 2020.
[9] 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 $748,690 and Rs. 120,000,000 or $714,116, at December 31, 2020 and June 30, 2020, respectively. The interest rate for the loan was 8.79% and 7.7% at December 31, 2020 and June 30, 2020, respectively. The balance outstanding at December 31, 2020 and June 30, 2020 was Rs. Nil. During the tenure of 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 December 31, 2020, NetSol PK was in compliance with these covenants.
[10] 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. The total facility amount is Rs. 900,000,000 or $5,615,173 and NetSol PK used Rs. 500,000,000 or $3,119,541 at December 31, 2020. The total facility amount is Rs. 900,000,000 or $5,355,868 and NetSol PK used Rs. 500,000,000 or $2,975,482 at June 30, 2020. The interest rate for the loan was 3% at December 31, 2020 and June 30, 2020.
[11] In March 2019, the Company's subsidiary, VLS, entered into a loan agreement. The loan amount was £69,549, or $95,273, for a period of 5 years with monthly payments of £1,349, or $1,848. As of December 31, 2020, the subsidiary has used this facility up to $63,677, of which $44,887 was shown as long-term and $18,790 as current. The interest rate was 6.14% at December 31, 2020.