Quarterly report pursuant to Section 13 or 15(d)


6 Months Ended
May 31, 2020
Leases [Abstract]  
Note 12 – Leases
Effective December 1, 2019, the Company adopted ASU
Leases (Topic 842), using the modified retrospective approach and utilizing the effective date as its date of initial application. As a result, prior periods are presented in accordance with the previous guidance in ASC 840, Leases (“ASC 840”). The Company has elected to apply the ‘package of practical expedients’ which allows the Company to not reassess i) whether existing or expired arrangements contain a lease, ii) the lease classification of existing or expired leases, or iii) whether previous initial direct costs would qualify for capitalization under the new lease standard.
At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present in the arrangement. Leases with a term greater than one year are recognized on the balance sheet as a
(ROU) assets and short-term and long-term lease liabilities, as applicable. The Company does not have any financing leases.
Operating lease liabilities and their corresponding
assets are initially recorded based on the present value of lease payments over the expected remaining lease term. The interest rate implicit in lease contracts is typically not readily determinable. As a result, the Company utilizes its incremental borrowing rate to discount lease payments, which reflects the fixed rate at which the Company believes it could borrow on a collateralized basis the amount of the lease payments in the same currency, for a similar term, in a similar economic environment.
The Company has elected not to recognize leases with an original term of one year or less on the balance sheet. The Company typically only includes an initial lease term in its assessment of a lease arrangement. Options to renew a lease are not included in the Company’s assessment unless there is reasonable certainty that the Company will renew.
The following table presents the
asset and short-term and long-term lease liabilities amounts recorded on the consolidated balance sheets as of May 31, 2020:
     May 31, 2020  
Operating lease
   $ 431,424  
Current portion of operating lease liabilities
   $ 268,341  
Operating lease long term liabilities
Total lease liability
   $ 431,590  
The maturity of the Company’s lease liabilities at May 31, 2020 were as follows:
     Future Operating  
Fiscal Year Ending November 30,
   Lease Payments  
2020 (remaining 6 months)
   $ 142,423  
Less: Imputed interest
Present value of lease liabilities
   $ 431,590  
The remaining lease term and discount rates are as follows:
     May 31, 2020  
Lease Term and Discount Rate
Remaining lease term (years)
Operating lease
Discount rate (percentage)
Operating lease
Supplemental cash flow information related to leases is as follows:
     Three Months Ended      Six Months Ended  
     May 31, 2020      May 31, 2020  
Operating cash outflows from operating leases
   $ 64,886      $ 131,186