GOODWILL IMPAIRMENT |
12 Months Ended |
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Jun. 30, 2026 | |
| Intangible Asset, Goodwill and Other [Abstract] | |
| GOODWILL IMPAIRMENT | NOTE 6. GOODWILL IMPAIRMENT
During the year ended June 30, 2026 (specifically during the three months ended March 31, 2026) there occurred a triggering event that gave rise to assess the carrying value of the BLI Sub RU goodwill balance.
The BLI Sub reporting unit (“BRU”) product customer is principally the U.S. Department of War (“DOW”). U.S. Government funding for new DOW projects that BRU was anticipating was put on hold as a result of: 1) the U.S. Government shutdown in January 2026, 2) the Continuing Budget Resolution in February 2026 which produced no new funding, and 3) delay in passing of the U.S. Government fiscal year 2026 budget.
The budget delay above resulted in BRU no longer being able to invoice its current primary DOW customer for work currently being done, material uncertainty regarding whether the current work will be funded in an ultimate U.S. Government budget passage and limited visibility regarding its ability to secure other future revenue contracts.
While revenues may be generated in the future, if the U.S. Government fiscal year 2026 budget or subsequent years budgets are approved or when the project is included in an approved budget in subsequent years, the current lack of sight into future revenue contracts and the Company’s inability to generate material revenues in the current fiscal year has removed the primary driver of the quantitative DCF modelling that is utilized in order to determine the enterprise value of BRU. This also makes the qualitative assessment of BRU’s technology challenging to assess. In accordance with our accounting policies (see Note 4), it was determined that BRU enterprise value is negligible from a financial reporting perspective. This resulted in a total goodwill impairment to the BRU, and the Company recorded a goodwill impairment expense of approximately $10.56 million in the consolidated statement of operations for the year ended June 30, 2026.
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