Revenue Recognition and Contracts with Customers

12 Months Ended

Jun. 30, 2023

Revenue Recognition and Contracts with Customers

Revenue Recognition and Contracts with Customers

NOTE 2 – Revenue Recognition and Contracts with Customers

The Company is engaged in one major line of business: the development, manufacture, and distribution of security products, encompassing access control systems, door security products, intrusion and fire alarm systems, alarm communication services, and video surveillance products for commercial and residential use. The Company also provides wireless communication service for intrusion and fire alarm systems on a monthly basis. These products are used for commercial, residential, institutional, industrial and governmental applications, and are sold worldwide principally to independent distributors, dealers and installers of security equipment. Sales to unaffiliated customers are primarily shipped from the United States.

As of June 30, 2023 and 2022, the Company included refund liabilities of approximately $5,521,000 and $5,863,000, respectively, in current liabilities. As of June 30, 2023 and 2022, the Company included return-related assets of approximately $1,338,000 and $974,000, respectively, in other current assets.

As a percentage of gross sales, sales returns, rebates and allowances were 7%, 10% and 10% for the fiscal years ended June 30, 2023, 2022 and 2021, respectively.

The Company disaggregates revenue from contracts with customers into major product lines. The Company determines that disaggregating revenue into these categories achieves the disclosure objective to depict how the nature, amount, timing, and

uncertainty of revenue and cash flows are affected by economic factors. As noted in the accounting policy footnote, the Company’s business consists of one operating segment. Following is the disaggregation of revenues based on major product lines (in thousands):

	Fiscal year ended June 30,
	2023		2022		2021
Major Product Lines:
Intrusion and access alarm products	$	47,344	$	49,606	$	36,794
Door locking devices		62,718		48,006		43,337
Services		59,935		45,981		33,904
Total Revenues	$	169,997	$	143,593	$	114,035

The following table represents the allowance for credit losses accounts as of the respective years ending June 30 (in thousands):

	Balance at beginning of period		Charged to costs and expenses		Deductions/ (recoveries)		Balance at end of period
For the Year Ended June 30, 2021:
Allowance for credit losses	$	326	$	30	$	(130)	$	226
For the Year Ended June 30, 2022:
Allowance for credit losses	$	226	$	17	$	—	$	243
For the Year Ended June 30, 2023:
Allowance for credit losses	$	243	$	6	$	(118)	$	131