Annual report pursuant to Section 13 and 15(d)

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
 12 Months Ended
Mar. 31, 2024
Accounting Policies [Abstract]  
Schedule of Variable Interest Entities
The carrying amounts of Freedom UA’s consolidated assets and liabilities were as follows as of March 31, 2023:
March 31, 2023
Cash and cash equivalents 26 
Restricted cash 1,936 
Trading securities 4,010 
Margin lending, brokerage and other receivables, net 1,616 
Fixed assets, net 782 
Intangible assets, net 131 
Right-of-use asset 135 
Other assets 56 
Total assets $ 8,692 
Customer liabilities 5,837 
Securities repurchase agreement obligations 12 
Trade payables 25 
Lease liability 159 
Other liabilities 298 
Total liabilities $ 6,331 
Schedule of Revenue by Major Customers by Reporting Segments
Revenues from one customer of the Group’s Brokerage segment represents the following amount of the Group’s consolidated revenues:
2024 2023 2022
Single non-related party
 296,257  48,430  — 
Schedule of changes in the carrying amount of goodwill
The changes in the carrying amount of goodwill for the years ended March 31, 2024 and March 31, 2023, were as follows:

Brokerage
Bank
Insurance
Other
 Total
Goodwill, gross
Balance as of March 31, 2022
$ 3,478  $ 2,742  $ 510  $ —  $ 6,730 
Foreign currency translation difference
 (801) (90) 470  832  411 
Acquired —  —  —  7,883  7,883 
Balance as of March 31, 2023
 2,677  $ 2,652  $ 980  $ 8,715  $ 15,024 
Write-off due to deconsolidation of Freedom UA
 —  —  —  (832) (832)
Foreign currency translation difference
 11  94  60  1  166 
Acquired —  —  —  38,290  38,290 
Balance as of March 31, 2024
 2,688  $ 2,746  $ 1,040  $ 46,174  $ 52,648 
Accumulated impairment
Balance as of March 31, 2022
 $ —  $ —  $ —  $ 832  $ 832 
Impairment expense —  —  —  —  — 
Balance as of March 31, 2023
 $ —  $ —  $ —  $ 832  $ 832 
Impairment expense —  —  — 
Write-off due to deconsolidation of Freedom UA
 —  —  —  (832) (832)
Balance as of March 31, 2024
 $ —  $ —  $ —  $ —  $ — 
Goodwill, net of impairment
Balance as of March 31, 2022
 $ 3,478  $ 2,742  $ 510  $ (832) $ 5,898 
Balance as of March 31, 2023
 $ 2,677  $ 2,652  $ 980  $ 7,883  $ 14,192 
Balance as of March 31, 2024
 $ 2,688  $ 2,746  $ 1,040  $ 46,174  $ 52,648 
Revision of prior period statements The following table illustrates the impact of ASC 326.
March 31, 2023 ASC 326 Adoption Impact April 1, 2023
Allowance for credit losses for loans
Mortgage loans $ 554  $ 2,216  $ 2,770 
Car loans 759  6,462  7,221 
Collateralized bank customer loans —  35  35 
Uncollateralized banks customer loans 233  7,436  7,669 
Right of claim for purchased retail loans 1,246  9,046  10,292 
Allowance for credit losses for other financial assets —  249  249 
Total allowance for credit losses $ 2,792  $ 25,444  $ 28,236 
Retained earnings
Total allowance increase 25,444 
Decrease to retained earnings, pre-tax 25,444 
Tax effect (2,671)
Foreign currency translation difference effect (1)
Decrease to retained earnings, net of tax effect $ 22,772 
The previously issued Consolidated Balance Sheet as of March 31, 2022, and Consolidated Statements of Operations and Statements of Other Comprehensive Income for the year ended March 31, 2022 have been revised as follows:
As of March 31, 2022
As previously reported FF Life acquisition Elimi-nations FF Insurance acquisition Elimi-nations As recasted
ASSETS
Cash and cash equivalents $ 224,663  $ 1,429  $ (917) $ 371  $ (82) $ 225,464 
Restricted cash 547,950  —  —  —  —  547,950 
Trading securities 1,080,982  8,875  —  68,520  —  1,158,377 
Available-for-sale securities, at fair value 1  161,363  —  —  —  161,364 
Margin lending, brokerage and other receivables, net 147,480  172  (34) 61  (20) 147,659 
Loans issued 92,403  43  —  —  —  92,446 
Fixed assets, net 17,387  182  —  254  —  17,823 
Intangible assets, net 3,512  1,490  —  161  —  5,163 
Goodwill 5,388  359  —  151  —  5,898 
Right-of-use asset 6,747  532  —  152  —  7,431 
Insurance contract assets —  3,555  —  2,157  —  5,712 
Other assets, net 19,351  9,863  —  427  —  29,641 
Assets held for sale 825,419  —  —  —  —  825,419 
TOTAL ASSETS $ 2,971,283  $ 187,863  $ (951) $ 72,254  $ (102) $ 3,230,347 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Securities repurchase agreement obligations $ 742,710  $ 47,690  $ —  $ 49,824  $ —  $ 840,224 
Customer liabilities 766,627  —  (917) —  (82) 765,628 
Margin lending and trade payables 45,082  —  —  21  (20) 45,083 
Liabilities from insurance activity —  108,925  —  13,162  —  122,087 
Current income tax liability 14,556  —  —  —  —  14,556 
Securities sold, not yet purchased – at fair value 13,865  —  —  —  —  13,865 
Debt securities issued 34,390  —  —  —  —  34,390 
Lease liability 6,785  543  —  176  —  7,504 
Liability arising from continuing involvement 6,447  —  —  —  —  6,447 
Other liabilities 20,668  551  (34) 292  —  21,477 
Liabilities held for sale 812,478  —  —  —  —  812,478 
TOTAL LIABILITIES $ 2,463,608  $ 157,709  $ (951) $ 63,475  $ (102) $ 2,683,739 
Commitments and Contingent Liabilities
 —  —  —  —  —  — 
SHAREHOLDERS’ EQUITY
Preferred stock -$0.001 par value; 20,000,000 shares authorized, no shares issued or outstanding
 —  —  —  —  —  — 
Common stock - $0.001 par value; 500,000,000 shares authorized; 59,542,212 shares issued and outstanding as of March 31, 2022
 59  9,465  (9,464) 15,576  (15,577) 59 
Additional paid in capital 141,340  —  16,498  —  16,907  174,745 
Retained earnings 426,563  28,132  (6,665) (4,812) (1,294) 441,924 
Accumulated other comprehensive loss (53,291) (7,444) (369) (1,985) (36) (63,125)
TOTAL FRHC SHAREHOLDERS’ EQUITY $ 514,671  $ 30,153  $ —  $ 8,779  $ —  $ 553,603 
Non-controlling interest (6,996) 1  —  —  —  (6,995)
TOTAL SHAREHOLDERS’ EQUITY $ 507,675  $ 30,154  $ —  $ 8,779  $ —  $ 546,608 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 2,971,283  $ 187,863  $ (951) $ 72,254  $ (102) $ 3,230,347 
Year ended March 31, 2022
As previously reported FF Life acquisition Elimi-nations FF Insurance acquisition Elimi-nations As recasted
Revenue:
Fee and commission income $ 335,444  $ —  $ —  $ 83  $ (316) $ 335,211 
Net gain/(loss) on trading securities 156,345  (1,283) —  190  —  155,252 
Interest income 90,153  23,027  —  8,429  —  121,609 
Insurance underwriting income —  60,526  —  12,455  —  72,981 
Net gain on foreign exchange operations 1,979  1,615  —  197  —  3,791 
Net gain on derivatives 946  —  —  —  —  946 
TOTAL REVENUE, NET $ 584,867  $ 83,885  $ —  $ 21,354  $ (316) $ 689,790 
Expense:
Fee and commission expense 73,243  12,289  —  693  (316) 85,909 
Interest expense 65,449  5,194  —  6,304  —  76,947 
Insurance claims incurred, net of reinsurance —  42,606  —  11,841  —  54,447 
Payroll and bonuses 39,779  3,624  —  2,885  —  46,288 
Professional services 12,123  106  —  453  —  12,682 
Stock compensation expense 7,859  —  —  —  —  7,859 
Advertising expense 10,059  —  —  1,857  —  11,916 
General and administrative expense 18,744  3,516  —  1,273  —  23,533 
Provision for impairment losses 2,206  —  —  296  —  2,502 
Other expense/(income), net 1,312  2,708  —  (6) —  4,014 
TOTAL EXPENSE $ 230,774  $ 70,043  $ —  $ 25,596  $ (316) $ 326,097 
NET INCOME/(LOSS) BEFORE INCOME TAX 354,093  13,842  —  (4,242) —  363,693 
Income tax (expense)/benefit (38,529) (54) —  13  —  (38,570)
INCOME/(LOSS) FROM CONTINUING OPERATIONS 315,564  13,788  —  (4,229) —  325,123 
Loss before income tax (expense)/benefit of discontinued operations (117,199) —  —  —  —  (117,199)
Income tax benefit of discontinued operations 13,004  —  —  —  —  13,004 
Loss from discontinued operations (104,195) —  —  —  —  (104,195)
NET INCOME/(LOSS) $ 211,369  $ 13,788  $ —  $ (4,229) $ —  $ 220,928 
Less: Net loss attributable to non-controlling interest in subsidiary (6,566) —  —  —  —  (6,566)
NET INCOME/(LOSS) ATTRIBUTABLE TO CONTROLLING INTEREST
 $ 217,935  $ 13,788  $ —  $ (4,229) $ —  $ 227,494 
OTHER COMPREHENSIVE INCOME
Change in unrealized gain on investments available-for-sale, net of tax effect —  (4,292) —  —  —  (4,292)
Reclassification adjustment for net realized gain on available-for-sale investments disposed of in the period, net of tax effect —  2,222  —  —  —  2,222 
Foreign currency translation adjustments (17,245) (2,014) —  (1,363) —  (20,622)
OTHER COMPREHENSIVE (LOSS)/INCOME (17,245) (4,084) —  (1,363) —  (22,692)
COMPREHENSIVE INCOME/(LOSS) BEFORE NON-CONTROLLING INTERESTS $ 194,124  $ 9,704  $ —  $ (5,592) $ —  $ 198,236 
Less: Comprehensive loss attributable to non-controlling interest in subsidiary (6,566) —  —  —  —  (6,566)
COMPREHENSIVE INCOME/(LOSS) ATTRIBUTABLE TO CONTROLLING INTEREST 200,690  9,704  —  (5,592) —  204,802