Right-of-use assets and lease liabilities

9 Months Ended

Sep. 30, 2022

Right-of-use Assets And Lease Liabilities

Right-of-use assets and lease liabilities

12.  Right-of-use assets and lease liabilities:

There is no discount rate implicit in the Anguilla office operating lease agreement, so the Company estimated a 5% discount rate for the incremental borrowing rate for the lease. There is no discount rate implicit in the license agreement, so the Company estimated a 12% discount rate for the incremental borrowing rate for the licenses as of the adoption date, January 1, 2019.

Effective April 1, 2019, we recognized lease assets and liabilities of $125,474, in relation to the Vancouver office. We estimated a discount rate of 4.12%.

We elected to not separate lease and non-lease components for all of our leases. For leases with a term of 12 months or less, our current offices, we elected the short-term lease exemption, which allowed us to not recognize right-of-use assets or lease liabilities for qualifying leases existing at transition and new leases we may enter into in the future, as there is significant uncertainty on whether the leases will be renewed.

The right-of-use assets are summarized as follows:

	September 30, 2022			December 31, 2021
Opening balance for the period	$	65,464		$	106,315
Amortization of operating lease right-of use assets		(21,758	)		(40,851	)
Closing balance for the period	$	43,706		$	65,464

The operating lease as at September 30, 2022, is summarized as follows:

As at September 30, 2022	Operating lease- Office lease
2022	$	7,984
2023		32,732
2024		7,499
Total lease payments	$	48,215
Less: Interest		(1,704	)
Present value of lease liabilities	$	46,511
Amounts recognized on the balance sheet
Current lease liabilities	$	31,112
Long-term lease liabilities		15,399
Total lease payments	$	46,511

Kidoz Inc. and subsidiaries

(Expressed in United States Dollars)

Notes to Consolidated Financial Statements

Nine Months ended September 30, 2022 and 2021

(Unaudited)

12. Right-of-use assets and lease liabilities: (Continued)

	September 30, 2022			December 31, 2021
Opening balance for the period	$	74,067		$	103,918
Payments on operating lease liabilities		(27,556	)		(29,851	)
Closing balance for the period		46,511			74,067
Less:  current portion		(31,112	)		(32,068	)
Operating lease liabilities – non-current portion as at end of period	$	15,399		$	41,999