Quarterly report pursuant to Section 13 or 15(d)

Supplemental Financial Statement Information

v3.21.2
Supplemental Financial Statement Information
 9 Months Ended
Sep. 30, 2021
Payables and Accruals [Abstract]  
Supplemental Financial Statement Information SUPPLEMENTAL FINANCIAL STATEMENT INFORMATION
Assets Held for Sale
An asset group classified as held for sale is reflected at the lower of its carrying amount or estimated fair value less cost to sell. If the carrying amount of the assets exceeds its estimated fair value, a loss is recognized. We recorded approximately $0.1 million and $0.9 million of machinery held for sale within "Assets Held for Sale" as of September 30, 2021 and December 31, 2020, respectively. We completed the sale of approximately $0.7 million of machinery during the second quarter of 2021, and are actively seeking a buyer and expect to complete the sale of the remaining machinery held for sale by the end of 2021. We recognized approximately $0.2 million in impairment charges during the three and nine months ended September 30, 2021. We did not recognize any impairment charges during the three and nine months ended September 30, 2020.
Other Current Assets
The following table summarizes the composition of other current assets as of the dates indicated:
(in thousands) September 30, 2021 December 31, 2020
Other current assets:
VAT refund receivable $ 146  $ 4,391 
Prepaid expenses 3,569  1,542 
Indemnification receivable, net 124  921 
Other 7,172  4,038 
$ 11,011  $ 10,892 
Accrued Expenses and Other Current Liabilities
The following table summarizes the composition of accrued expenses and other current liabilities as of the dates indicated:
(in thousands) September 30, 2021 December 31, 2020
Accrued expenses and other current liabilities:
VAT payable $ 3,084  $ 9,882 
Contingent consideration 1,710  — 
Payroll related including bonus 5,814  2,361 
Accrued professional fees 4,341  1,750 
Accrued third-party logistics fees 272  1,295 
Refund liability 1,100  785 
Current portion of long-term debt 1,429  182 
Other 5,152  3,317 
$ 22,902  $ 19,572 
Customer Deposits
For certain product offerings such as premium, patented, child-resistant packaging, closed-system vaporization solutions and custom-branded retail products, we may receive a deposit from the customer (generally 25% - 50% of the total order cost, but the amount can vary by customer contract), when an order is placed by a customer. We typically complete orders related to customer deposits within one to six months from the date of order, depending on the complexity of the customization and the size of the order, but the order completion timeline can vary by product type and terms of sale with each customer. Changes in our customer deposits liability balance during the nine months ended September 30, 2021 were as follows:
(in thousands) Customer Deposits
Balance as of December 31, 2020 $ 2,729 
Customer deposits assumed as part of KushCo acquisition (Note 3 - Business Acquisitions) 3,934 
Increases due to deposits received, net of other adjustments 9,728 
Revenue recognized (9,874)
Balance as of September 30, 2021
 $ 6,517 

Accumulated Other Comprehensive Income (Loss)
The components of accumulated other comprehensive income (loss) for the periods presented were as follows:
(in thousands) Foreign Currency Translation Unrealized Loss on Derivative Instrument Total
Balance at December 31, 2020 $ 183  $ (154) $ 29 
Other comprehensive (loss) income (59) 256  $ 197 
Less: Other comprehensive loss (income) attributable to non-controlling interest 20  (154) $ (134)
Balance at September 30, 2021
 $ 144  $ (52) $ 92 
(in thousands) Foreign Currency Translation Unrealized Loss on
Derivative Instrument		 Total
Balance at December 31, 2019 $ (22) $ (50) $ (72)
Other comprehensive income (loss) 130  (525) (395)
Less: Other comprehensive (income) loss attributable to non-controlling interest (87) 400  313 
Balance at September 30, 2020
 $ 21  $ (175) $ (154)

Supplier Concentration
Our four largest vendors accounted for an aggregate of approximately 29.2% and 22.8% of our total net sales and 53.2% and 84.0% of our total purchases for the three and nine months ended September 30, 2021, respectively, and an aggregate of approximately 38.4% and 22.1% of our total net sales and 27.9% and 43.1% of our total purchases for the three and nine months ended September 30, 2020, respectively. We expect to maintain our existing relationships with these vendors.
Related Party Transactions
The Company sold certain products and supplies to a related party during the three months ended September 30, 2021. Sales to related parties during the three and nine months ended September 30, 2021 totaled $0.1 million. Sales to related parties during the three and nine months ended September 30, 2020 were $0. Total accounts receivable due from related parties were $0.4 million and $0 as of September 30, 2021 and December 30, 2020, respectively.