Long Term Investment
|3 Months Ended|
Sep. 30, 2018
|Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]|
|Long Term Investment||
NOTE 12 – LONG TERM INVESTMENT
On March 2, 2017, the Company purchased a 4.9% interest in WRLD3D, a non-public company, for $1,111,111. The Company paid $555,556 at the initial closing and $555,555 on September 1, 2017. NetSol PK, the subsidiary of the Company, purchased a 12.2% investment in WRLD3D, for $2,777,778 which will be earned over future periods by providing IT and enterprise software solutions. Per the agreement, NetSol PK is to provide a minimum of $200,000 of services in each three-month period and the entire balance is required to be provided within three years of the date of the agreement. If NetSol PK fails to provide the future services, it may be required to forfeit the shares back to WRLD3D. As of June 30, 2018, the investment earned by NetSol PK is $2,777,778.
In connection with the investment, the Company and NetSol PK received a warrant to purchase preferred stock of WRLD3D which included the following key terms and features:
The Company determined that it met the significant influence criteria since the CEO of WRLD3D is the son of the CEO, Najeeb Ghauri, and also an employee of the Company; therefore, the Company accounts for the investment using equity method of accounting.
During the three months ended September 30, 2018 and 2017, NetSol PK provided services valued at $162,845 and $268,300, respectively, which is recorded as services-related party. Accounts receivable at September 30, 2018 and June 30, 2018 were $592,284 and $473,218, respectively. Revenue in excess of billing at September 30, 2018 and June 30, 2018 were $70,250 and $Nil, respectively.
Under the equity method of accounting, the Company recorded its share of net loss of $299,691 and $67,562 for the three months ended September 30, 2018 and 2017, respectively.
The entire disclosure for other assets. This disclosure includes other current assets and other noncurrent assets.
No definition available.