v3.26.1
Note 15 - Leases
9 Months Ended
Jun. 30, 2026
Notes to Financial Statements  
Lessee, Operating Leases [Text Block]

(15) LEASES

 

Leases as Lessor

 

Monitoring Equipment and Other Related Services

 

The Company leases monitoring equipment and provides monitoring services to its customers with contract terms varying from month-to-month to several years and each daily contract price varies. Devices supplied to customers are not serial number unique and a single device may be used by multiple customers over its useful life. If a leased device is returned for repair, it will likely be replaced with a different device from a different customer or possibly a new device.

 

The Company’s tracking devices are considered operating leases under ASC 842 as transfer of control of the asset does not occur at the end of the lease, a single device is not specific to a customer and devices may be used by multiple customers throughout their life cycle. Due to the movement of devices from customer to customer, relatively few long-term contracts, the measurement of the equipment life and the present value of the equipment’s fair values would not be a measurement to qualify the devices as sales-type leases.

 

Operating lease and monitoring revenue associated with the Company’s monitoring equipment for the three and nine months ended June 30, 2026 and 2025, respectively, are shown in the table below:

 

   

Three Months Ended

June 30,

   

Nine Months Ended

June 30,

 
   

2026

   

2025

   

2026

   

2025

 

Monitoring equipment operating revenue

  $ 7,660,840     $ 7,432,147     $ 23,213,984     $ 22,324,737  

 

The Company cannot accurately estimate 5-years of future minimum lease receipts for its devices leased to customers because none of its customers make any contractual commitment regarding the number of active devices utilized in any given year and those quantities of active devices vary significantly for every customer each and every day. 

 

Leases as Lessee

 

The following table shows right of use assets and lease liabilities for real estate and equipment, with the associated financial statement line items as of June 30, 2026 and September 30, 2025.

 

   

June 30, 2026

   

September 30, 2025

 
   

Operating

lease

asset

   

Operating

lease

liability

   

Operating

lease

asset

   

Operating

lease

liability

 
                                 

Other assets

  $ 567,277             $ 722,278          

Accrued liabilities

          $ 213,621             $ 201,098  

Long-term liabilities

          $ 367,237             $ 529,265  

 

 

The following table summarizes the supplemental cash flow information for the three months ended June 30, 2026 and 2025:

 

   

Nine Months

Ended

June 30,

2026

   

Nine Months

Ended

June 30,

2025

 
                 

Cash paid for noncancelable operating leases included in operating cash flows

  $ 226,143     $ 211,318  

Right of use assets obtained in exchange for operating lease liabilities

  $ -     $ 627,701  

 

The future minimum lease payments under noncancelable operating leases with terms greater than one year as of June 30, 2026 are:

 

   

Operating
Leases

 

From July 2026 to June 2027

  $ 236,259  

From July 2027 to June 2028

    162,565  

From July 2028 to June 2029

    150,752  

From July 2029 to June 2030

    75,730  

Undiscounted cash flow

    625,306  

Less: imputed interest

    (44,448 )

Total

  $ 580,858  
         

Reconciliation to lease liabilities:

       

Lease liabilities - current

  $ 213,621  

Lease liabilities - long-term

    367,237  

Total lease liabilities

  $ 580,858  

 

The weighted-average remaining lease term and discount rate related to the Company’s lease liabilities as of June 30, 2026 were 2.99 years and 4.8%, respectively. The Company’s lease discount rates are generally based on the estimates of its incremental borrowing rate as the discount rates implicit in the Company’s leases cannot be readily determined.