0000056701-23-000026 | 10-K | XBRL Viewer

Accrued Liabilities (Tables)

12 Months Ended

Jun. 30, 2023


	2023		2022
Cooperative advertising and promotion allowances	$	77,181	$	200,175
Customer credit balances		281,780		30,515
Employee benefits		76,323		75,101
Legal and professional fees		85,500		86,500
Bonus and profit-sharing		369,529		91,784
Sales commissions and bonuses		46,857		39,195
Other		33,360		37,086
Total accrued liabilities	$	970,530	$	560,356

Credit Facility And SBA Loan	12 Months Ended
Jun. 30, 2023
Credit Facility And SBA Loan [Abstract]
Credit Facility And SBA Loan	8. CREDIT FACILITY AND SBA LOAN On May 14, 2019, the Company entered into a secured credit facility ("Credit Agreement") with Town Bank (“Lender”). The Credit Agreement provides for a $5,000,000 revolving secured credit facility for letters of credit for the benefit of the Company of up to a sublimit of $1,000,000. There are no unused line fees in the credit facility. On January 28, 2021, the Credit Agreement was amended to extend the expiration to October 31, 2022, and to change the interest rate to Wall Street Journal Prime less 1.50%. A Third Amendment to the Credit Agreement effective October 30, 2022, extends the maturity date to October 31, 2024. The Company and the Lender also entered into a General Business Security Agreement dated May 14, 2019, under which the Company granted the Lender a security interest in substantially all of the Company’s assets in connection with the Company’s obligations under the Credit Agreement. The Credit Agreement contains certain affirmative and negative covenants customary for financings of this type. The negative covenants include restrictions on other indebtedness, liens, fundamental changes, certain investments, disposition of assets, mergers, and liquidations, among other restrictions. As of June 30, 2023, the Company was in compliance with all covenants related to the Credit Agreement. As of June 30, 2023 and 2022, there were no outstanding borrowings on the facility. The Company incurs interest expense primarily related to its secured credit facility. There was no interest expense for the years ended June 30, 2023 or 2022.

Credit Facility And SBA Loan

12 Months Ended

Jun. 30, 2023

Credit Facility And SBA Loan [Abstract]

Credit Facility And SBA Loan

8. CREDIT FACILITY AND SBA LOAN

On May 14, 2019, the Company entered into a secured credit facility ("Credit Agreement") with Town Bank (“Lender”). The Credit Agreement provides for a $5,000,000 revolving secured credit facility for letters of credit for the benefit of the Company of up to a sublimit of $1,000,000. There are no unused line fees in the credit facility. On January 28, 2021, the Credit Agreement was amended to extend the expiration to October 31, 2022, and to change the interest rate to Wall Street Journal Prime less 1.50%. A Third Amendment to the Credit Agreement effective October 30, 2022, extends the maturity date to October 31, 2024. The Company and the Lender also entered into a General Business Security Agreement dated May 14, 2019, under which the Company granted the Lender a security interest in substantially all of the Company’s assets in connection with the Company’s obligations under the Credit Agreement. The Credit Agreement contains certain affirmative and negative covenants customary for financings of this type. The negative covenants include restrictions on other indebtedness, liens, fundamental changes, certain investments, disposition of assets, mergers, and liquidations, among other restrictions. As of June 30, 2023, the Company was in compliance with all covenants related to the Credit Agreement. As of June 30, 2023 and 2022, there were no outstanding borrowings on the facility.

The Company incurs interest expense primarily related to its secured credit facility. There was no interest expense for the years ended June 30, 2023 or 2022.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

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+ Details

Significant Accounting Policies	12 Months Ended
Jun. 30, 2023
Significant Accounting Policies [Abstract]
Significant Accounting Policies	KOSS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. SIGNIFICANT ACCOUNTING POLICIES NATURE OF BUSINESS — Koss Corporation ("Koss"), a Delaware corporation, and its 100%-owned subsidiaries (collectively the "Company"), reports its finances as a single reporting segment, as the Company’s only business line is the design, manufacture and sale of stereo headphones and related accessories. The Company leases its plant and office in Milwaukee, Wisconsin. The domestic market is served by domestic sales representatives and independent manufacturers' representatives working directly with certain retailers, distributors, and original equipment manufacturers. International markets are served by domestic sales representatives and sales personnel in the Netherlands and the Caucasus region which utilize independent distributors in several foreign countries. The Company has two subsidiaries, Koss Corp B.V. and Koss U.K. Limited ("Koss UK"), which were formed to comply with certain European Union ("EU") requirements. Koss Corp B.V. and Koss UK are non-operating and hold no assets. BASIS OF CONSOLIDATION — The Consolidated Financial Statements include the accounts of Koss and its subsidiaries, Koss Corp B.V. and Koss UK, which are 100%-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. REVENUE RECOGNITION — Revenues from product sales are recognized when the customer obtains control of the product, which typically occurs upon shipment from the Company's facility. There are a very limited number of customers for which control does not pass until they have received the products at their facility. Revenue from product sales is adjusted for estimated warranty obligations and variable consideration, which are detailed below. The amount of revenue recognized is to reflect the consideration expected to be received for those goods or services. Warranties - The Company offers a lifetime warranty to consumers in the United States and certain other countries. This lifetime warranty creates a future performance obligation. The Company determines the standalone selling price for this performance obligation using the cost-plus method. There are also certain foreign distributors that receive warranty repair parts and replacement headphones to satisfy warranty obligations in those countries. The Company defers revenue to recognize the future obligations related to these warranties. The deferred revenue is based on historical analysis of warranty claims relative to sales. This deferred revenue reflects the Company's best estimates of the amount of warranty returns and repairs it will experience during those future periods. If future warranty activity varies from the estimates, the Company will adjust the estimated deferred revenue, which would affect net sales and operating results in the period that such adjustment becomes known. The Company typically receives payment for product at the time of shipment or under normal collection terms, which are generally 30-60 days. The Company estimates that the warranty related performance obligation is satisfied within one to three years and therefore uses that same time frame for recognition of the deferred revenue, using amortization of 50% in year 1, 30% in year 2, and 20% in year 3 for domestic sales. Export deferred revenue, where applicable, is recognized over a 12-month period from date of shipment. Reserves for Variable Consideration - Revenue from product sales is recorded at the net sales price, which includes estimates of variable consideration for which reserves are established and which result from returns, rebates, and co-pay assistance that are offered within contracts between the Company and its customers. Overall, these reserves reflect the Company's best estimates of the amount of consideration to which it is entitled based on the terms of the contract. If actual results in the future vary from the estimates, the Company will adjust these estimates, which would affect net sales and operating results in the period such variances become known. Product Returns - The Company generally offers customers a limited right of return. The Company estimates the amount of product sales that may be returned by its customers and records the estimate as a reduction of revenue in the period the related product revenue is recognized. Product return liabilities are estimated using historical sales and returns information. If actual results in the future vary from the estimates, the Company will adjust these estimates, which would affect net sales and operating results in the period such variances become known. Volume Rebates - The Company offers volume rebates to certain customers in the United States and certain foreign distributors. These volume rebates are tied to sales volume within specified periods. The amount of revenue is reduced for variable consideration related to customer rebates, which are calculated using expected values and is based on program specific factors such as expected rebate percentages and expected volumes. Changes in such accruals may be required if actual sales volume differs from estimated sales volume, which would affect net sales and operating results in the period such variances become known. Seller Fees – The Company pays fees to a major online marketplace for use of its services. Referral fees, the commission paid to the online platform to cover the costs associated with promoting, advertising, and facilitating product sales to its customers, are calculated as a percentage of the sales price and are imposed on sales of all products sold through the marketplace. When orders are fulfilled by the online marketplace, the Company is assessed fulfillment fees to cover the cost of fulfillment of the order as well as the assumption of risk of inventory control, damages and returns. The fees assessed are based on a product’s category, price, size and weight and are deducted from the sales price of each product prior to remittance to the Company with revenue reported on a net basis. Prior to fiscal year 2023, revenue from orders obtained through the online marketplace but fulfilled by the Company direct to the end customer was reported net of referral fees, and related fulfillment costs were recorded in cost of goods sold. Effective with the current year, the referral fees of $43,190 were reported as selling expense and revenue was reported as gross sales. As a result of the accounting change, a reclass was made for fiscal year ending June 30, 2022 to move $98,252 of referral fees from Net Sales to Selling, General and Administrative Expenses to report these sales on a consistent basis. Sales Commissions - The Company has elected the practical expedient of not capitalizing sales commissions. RESEARCH AND DEVELOPMENT — Research and development is primarily comprised of product prototypes and testing. These activities, charged to operations as a component of selling, general and administrative expenses in the accompanying Consolidated Statements of Income, amounted to $288,231 and $285,244 in 2023 and 2022, respectively. ADVERTISING COSTS — Advertising costs included within selling, general and administrative expenses in the accompanying Consolidated Statements of Income were $65,374 in 2023 and $50,513 in 2022. Such costs are expensed as incurred. INCOME TAXES — The Company operates as a C Corporation under the Internal Revenue Code (the “Code"). Amounts provided for income tax expense are based on income reported for financial statement purposes and do not necessarily represent amounts currently payable under tax laws. Deferred income tax assets and liabilities are computed annually for differences between the financial statements and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. As changes in tax laws or rates are enacted, deferred income tax assets and liabilities are adjusted through the provision for income taxes. The differences relate principally to different methods used for depreciation and amortization for income tax purposes, net operating loss carryforwards, capitalization requirements of the Code, allowances for doubtful accounts, provisions for excess and obsolete inventory, stock-based compensation, warranty reserves, and other income tax related carryforwards. A valuation allowance is established when necessary to reduce deferred income tax assets to the amount that is more likely than not to be realized. PATENT COSTS — The Company incurs on-going legal fees and filing costs related to the patent portfolio. These costs are expensed in the period they are incurred since no patent legal costs were probable to provide a future economic benefit. INCOME PER COMMON AND COMMON STOCK EQUIVALENT SHARE — Income per common and common stock equivalent share is calculated under the provisions of Topic 260 in the Accounting Standards Codification ("ASC") which provides for calculation of “basic” and “diluted” income per share. Basic income per common and common stock equivalent share includes no dilution and is computed by dividing net income by the weighted average common shares outstanding for the period. Diluted income per common and common stock equivalent share reflects the potential dilution of securities that could share in the earnings of an entity. See Note 11 for additional information on income per common and common stock equivalent share. CASH AND CASH EQUIVALENTS — The Company considers depository accounts and investments with a maturity at the date of acquisition and expected usage of three months or less to be cash and cash equivalents. The Company maintains its cash on deposit at a commercial bank located in the United States of America. The Company periodically has cash balances in excess of insured amounts. The Company has not experienced, and does not expect to incur, any losses on these deposits. ACCOUNTS RECEIVABLE — Accounts receivable consist of unsecured trade receivables due from customers. An allowance for doubtful accounts is recorded for significant past due receivable balances based on a review of the past due item and general economic conditions. INVESTMENTS — Debt securities are classified as held-to-maturity as the Company has the positive intent and ability to hold them to maturity. The securities are carried at amortized cost as current or noncurrent based upon maturity date and unrealized gains and losses are recognized when realized. The amortized cost of debt securities is adjusted for amortization of premium and accretion of discount to maturity. Such amortization or accretion is included in interest income, along with other interest on cash and cash equivalents. See Note 4 for additional information on investments. INVENTORIES — As of June 30, 2023 and 2022, the Company’s inventory was recorded using standard cost which approximates the lower of first in first out (“FIFO”) cost or net realizable value. The carrying value of inventory is reviewed for impairment on at least a quarterly basis, or more frequently if warranted due to changes in market conditions. See Note 5 for additional information on inventory. EQUIPMENT AND LEASEHOLD IMPROVEMENTS — Equipment and leasehold improvements are stated at cost. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the respective assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the asset. Major expenditures for property and equipment and significant renewals are capitalized. Maintenance, repairs and minor renewals are expensed as incurred. When assets are retired or otherwise disposed of, their costs and related accumulated depreciation and amortization are removed from the accounts and any resulting gains or losses are included in operations. See Note 6 for additional information on equipment and leasehold improvements. LEASES — The Company determines if a contract is a lease at the date of inception. The Company leases its facility in Milwaukee, Wisconsin from Koss Holdings, LLC, which is controlled by five equal ownership interests in trusts held by the five beneficiaries of the former chairman’s revocable trust and includes current stockholders of the Company. The lease agreement provides the Company the right to substantially all of the economic benefits and direct the use of the building, thus is considered a lease. The agreement does not convey ownership of the building to the lessee at the end of the term of the lease so is accounted for as an operating lease. Operating leases are reported on the Company's Consolidated Balance Sheets as operating lease right-of-use ("ROU") assets and operating lease liabilities. Operating lease ROU assets and liabilities are valued at the present value of the future lease payment obligations. The Company uses a rate based upon current incremental borrowing rates to determine the present value of future lease payments as the rate is not implicit in the lease. Operating lease expense is recorded on a straight-line basis over the life of the lease taking into account expected renewal periods. LIFE INSURANCE POLICIES — Life insurance policies are stated at cash surrender value or at the amount the Company would receive in the case of split-dollar arrangements. Increases in cash surrender value, net of annual premiums paid, and the proceeds from company-owned life insurance policies are included in selling, general and administrative expenses and other income, respectively, in the Consolidated Statements of Income. DEFERRED COMPENSATION —At June 30, 2023 and 2022, the Company’s deferred compensation liability is for a current officer and is calculated based on years of service and compensation, along with various assumptions related to expected retirement date, discount rates, and mortality tables. The related expense is calculated using the net present value of the expected payments and is included in selling, general and administrative expenses in the Consolidated Statements of Income. The selling, general and administrative expenses recorded during the year end June 30, 2022, also include the gain recorded as a result of the reversal of the deferred compensation current and noncurrent liabilities recorded for the Company’s founder who passed away on December 21, 2021. See Note 10 for additional information on deferred compensation. FAIR VALUE OF FINANCIAL INSTRUMENTS — Cash equivalents, accounts receivable, and accounts payable approximate fair value based on the short maturity of these instruments. The Company’s investments are classified as held-to-maturity and reported at amortized cost on the Consolidated Balance Sheets. The fair value is based upon quoted market prices and is disclosed in Note 4. IMPAIRMENT OF LONG-LIVED ASSETS — The Company evaluates the recoverability of the carrying amount of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. If an asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell. Management determines fair value using an undiscounted future cash flow analysis or other accepted valuation techniques. No impairments of the Company's long-lived assets were recorded in the years ended June 30, 2023 or 2022. LEGAL COSTS — All legal costs related to litigation, for which the Company is liable, are charged to operations as incurred, except contingent legal fees as described below. Proceeds from the settlement of legal disputes are recorded in other income when the amounts are determinable, and the collection is certain. License proceeds are considered functional and as such are recorded at a point in time, based on the underlying agreement. Related contingent legal fees and expenses are recorded in selling, general and administrative expense at that time. Changes to the contingent legal fee expenses would cause a material impact to the results of operations. STOCK-BASED COMPENSATION — The Company has a stock-based employee compensation plan, which is described more fully in Note 12. The Company accounts for stock-based compensation in accordance with ASC 718 "Compensation - Stock Compensation". Under the fair value recognition provisions of this statement, share-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the vesting period. OTHER INCOME — The Company maintains a program focused on enforcing its intellectual property and, in particular, certain of its patent portfolio, by filing complaints against certain parties alleging infringement on the Company’s patents relating to its wireless headphone technology. The Company has granted license agreements related to certain patents allowing the Company to recover certain of the fees and costs that were involved with the underlying efforts to enforce this portfolio. In the years ended June 30, 2023 and 2022, the Company received licensing proceeds of $33,000,000 and $100,000, respectively, which were recorded as other income. In the year ended June 30, 2022, the Company also recognized approximately $262,000 of other income related to the proceeds from company-owned life insurance policies on its founder, who passed away on December 21, 2021. USE OF ESTIMATES — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenue and expenses during the reported periods. Actual results could differ from those estimates.

Significant Accounting Policies

12 Months Ended

Jun. 30, 2023

Significant Accounting Policies [Abstract]

Significant Accounting Policies

KOSS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SIGNIFICANT ACCOUNTING POLICIES

NATURE OF BUSINESS — Koss Corporation ("Koss"), a Delaware corporation, and its 100%-owned subsidiaries (collectively the "Company"), reports its finances as a single reporting segment, as the Company’s only business line is the design, manufacture and sale of stereo headphones and related accessories. The Company leases its plant and office in Milwaukee, Wisconsin. The domestic market is served by domestic sales representatives and independent manufacturers' representatives working directly with certain retailers, distributors, and original equipment manufacturers. International markets are served by domestic sales representatives and sales personnel in the Netherlands and the Caucasus region which utilize independent distributors in several foreign countries. The Company has two subsidiaries, Koss Corp B.V. and Koss U.K. Limited ("Koss UK"), which were formed to comply with certain European Union ("EU") requirements. Koss Corp B.V. and Koss UK are non-operating and hold no assets.

BASIS OF CONSOLIDATION — The Consolidated Financial Statements include the accounts of Koss and its subsidiaries, Koss Corp B.V. and Koss UK, which are 100%-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated.

REVENUE RECOGNITION — Revenues from product sales are recognized when the customer obtains control of the product, which typically occurs upon shipment from the Company's facility. There are a very limited number of customers for which control does not pass until they have received the products at their facility. Revenue from product sales is adjusted for estimated warranty obligations and variable consideration, which are detailed below. The amount of revenue recognized is to reflect the consideration expected to be received for those goods or services.

Warranties - The Company offers a lifetime warranty to consumers in the United States and certain other countries. This lifetime warranty creates a future performance obligation. The Company determines the standalone selling price for this performance obligation using the cost-plus method. There are also certain foreign distributors that receive warranty repair parts and replacement headphones to satisfy warranty obligations in those countries. The Company defers revenue to recognize the future obligations related to these warranties. The deferred revenue is based on historical analysis of warranty claims relative to sales. This deferred revenue reflects the Company's best estimates of the amount of warranty returns and repairs it will experience during those future periods. If future warranty activity varies from the estimates, the Company will adjust the estimated deferred revenue, which would affect net sales and operating results in the period that such adjustment becomes known. The Company typically receives payment for product at the time of shipment or under normal collection terms, which are generally 30-60 days. The Company estimates that the warranty related performance obligation is satisfied within one to three years and therefore uses that same time frame for recognition of the deferred revenue, using amortization of 50% in year 1, 30% in year 2, and 20% in year 3 for domestic sales. Export deferred revenue, where applicable, is recognized over a 12-month period from date of shipment.

Reserves for Variable Consideration - Revenue from product sales is recorded at the net sales price, which includes estimates of variable consideration for which reserves are established and which result from returns, rebates, and co-pay assistance that are offered within contracts between the Company and its customers. Overall, these reserves reflect the Company's best estimates of the amount of consideration to which it is entitled based on the terms of the contract. If actual results in the future vary from the estimates, the Company will adjust these estimates, which would affect net sales and operating results in the period such variances become known.

Product Returns - The Company generally offers customers a limited right of return. The Company estimates the amount of product sales that may be returned by its customers and records the estimate as a reduction of revenue in the period the related product revenue is recognized. Product return liabilities are estimated using historical sales and returns information. If actual results in the future vary from the estimates, the Company will adjust these estimates, which would affect net sales and operating results in the period such variances become known.

Volume Rebates - The Company offers volume rebates to certain customers in the United States and certain foreign distributors. These volume rebates are tied to sales volume within specified periods. The amount of revenue is reduced for variable consideration related to customer rebates, which are calculated using expected values and is based on program specific factors such as expected rebate percentages and expected volumes. Changes in such accruals may be required if actual sales volume differs from estimated sales volume, which would affect net sales and operating results in the period such variances become known.

Seller Fees – The Company pays fees to a major online marketplace for use of its services. Referral fees, the commission paid to the online platform to cover the costs associated with promoting, advertising, and facilitating product sales to its customers, are calculated as a percentage of the sales price and are imposed on sales of all products sold through the marketplace. When orders are fulfilled by the online marketplace, the Company is assessed fulfillment fees to cover the cost of fulfillment of the order as well as the assumption of risk of inventory control, damages and returns. The fees assessed are based on a product’s category, price, size and weight and are deducted from the sales price of each product prior to remittance to the Company with revenue reported on a net basis. Prior to fiscal

year 2023, revenue from orders obtained through the online marketplace but fulfilled by the Company direct to the end customer was reported net of referral fees, and related fulfillment costs were recorded in cost of goods sold. Effective with the current year, the referral fees of $43,190 were reported as selling expense and revenue was reported as gross sales. As a result of the accounting change, a reclass was made for fiscal year ending June 30, 2022 to move $98,252 of referral fees from Net Sales to Selling, General and Administrative Expenses to report these sales on a consistent basis.

Sales Commissions - The Company has elected the practical expedient of not capitalizing sales commissions.

RESEARCH AND DEVELOPMENT — Research and development is primarily comprised of product prototypes and testing. These activities, charged to operations as a component of selling, general and administrative expenses in the accompanying Consolidated Statements of Income, amounted to $288,231 and $285,244 in 2023 and 2022, respectively.

ADVERTISING COSTS — Advertising costs included within selling, general and administrative expenses in the accompanying Consolidated Statements of Income were $65,374 in 2023 and $50,513 in 2022. Such costs are expensed as incurred.

INCOME TAXES — The Company operates as a C Corporation under the Internal Revenue Code (the “Code"). Amounts provided for income tax expense are based on income reported for financial statement purposes and do not necessarily represent amounts currently payable under tax laws. Deferred income tax assets and liabilities are computed annually for differences between the financial statements and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. As changes in tax laws or rates are enacted, deferred income tax assets and liabilities are adjusted through the provision for income taxes. The differences relate principally to different methods used for depreciation and amortization for income tax purposes, net operating loss carryforwards, capitalization requirements of the Code, allowances for doubtful accounts, provisions for excess and obsolete inventory, stock-based compensation, warranty reserves, and other income tax related carryforwards. A valuation allowance is established when necessary to reduce deferred income tax assets to the amount that is more likely than not to be realized.

PATENT COSTS — The Company incurs on-going legal fees and filing costs related to the patent portfolio. These costs are expensed in the period they are incurred since no patent legal costs were probable to provide a future economic benefit.

INCOME PER COMMON AND COMMON STOCK EQUIVALENT SHARE — Income per common and common stock equivalent share is calculated under the provisions of Topic 260 in the Accounting Standards Codification ("ASC") which provides for calculation of “basic” and “diluted” income per share. Basic income per common and common stock equivalent share includes no dilution and is computed by dividing net income by the weighted average common shares outstanding for the period. Diluted income per common and common stock equivalent share reflects the potential dilution of securities that could share in the earnings of an entity. See Note 11 for additional information on income per common and common stock equivalent share.

CASH AND CASH EQUIVALENTS — The Company considers depository accounts and investments with a maturity at the date of acquisition and expected usage of three months or less to be cash and cash equivalents. The Company maintains its cash on deposit at a commercial bank located in the United States of America. The Company periodically has cash balances in excess of insured amounts. The Company has not experienced, and does not expect to incur, any losses on these deposits.

ACCOUNTS RECEIVABLE — Accounts receivable consist of unsecured trade receivables due from customers. An allowance for doubtful accounts is recorded for significant past due receivable balances based on a review of the past due item and general economic conditions.

INVESTMENTS — Debt securities are classified as held-to-maturity as the Company has the positive intent and ability to hold them to maturity. The securities are carried at amortized cost as current or noncurrent based upon maturity date and unrealized gains and losses are recognized when realized. The amortized cost of debt securities is adjusted for amortization of premium and accretion of discount to maturity. Such amortization or accretion is included in interest income, along with other interest on cash and cash equivalents. See Note 4 for additional information on investments.

INVENTORIES — As of June 30, 2023 and 2022, the Company’s inventory was recorded using standard cost which approximates the lower of first in first out (“FIFO”) cost or net realizable value. The carrying value of inventory is reviewed for impairment on at least a quarterly basis, or more frequently if warranted due to changes in market conditions. See Note 5 for additional information on inventory.

EQUIPMENT AND LEASEHOLD IMPROVEMENTS — Equipment and leasehold improvements are stated at cost. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the respective assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the asset. Major expenditures for property and equipment and significant renewals are capitalized. Maintenance, repairs and minor renewals are expensed as incurred. When assets are retired or otherwise disposed of, their costs and related accumulated depreciation and

amortization are removed from the accounts and any resulting gains or losses are included in operations. See Note 6 for additional information on equipment and leasehold improvements.

LEASES — The Company determines if a contract is a lease at the date of inception. The Company leases its facility in Milwaukee, Wisconsin from Koss Holdings, LLC, which is controlled by five equal ownership interests in trusts held by the five beneficiaries of the former chairman’s revocable trust and includes current stockholders of the Company. The lease agreement provides the Company the right to substantially all of the economic benefits and direct the use of the building, thus is considered a lease. The agreement does not convey ownership of the building to the lessee at the end of the term of the lease so is accounted for as an operating lease.

Operating leases are reported on the Company's Consolidated Balance Sheets as operating lease right-of-use ("ROU") assets and operating lease liabilities. Operating lease ROU assets and liabilities are valued at the present value of the future lease payment obligations. The Company uses a rate based upon current incremental borrowing rates to determine the present value of future lease payments as the rate is not implicit in the lease. Operating lease expense is recorded on a straight-line basis over the life of the lease taking into account expected renewal periods.

LIFE INSURANCE POLICIES — Life insurance policies are stated at cash surrender value or at the amount the Company would receive in the case of split-dollar arrangements. Increases in cash surrender value, net of annual premiums paid, and the proceeds from company-owned life insurance policies are included in selling, general and administrative expenses and other income, respectively, in the Consolidated Statements of Income.

DEFERRED COMPENSATION —At June 30, 2023 and 2022, the Company’s deferred compensation liability is for a current officer and is calculated based on years of service and compensation, along with various assumptions related to expected retirement date, discount rates, and mortality tables. The related expense is calculated using the net present value of the expected payments and is included in selling, general and administrative expenses in the Consolidated Statements of Income. The selling, general and administrative expenses recorded during the year end June 30, 2022, also include the gain recorded as a result of the reversal of the deferred compensation current and noncurrent liabilities recorded for the Company’s founder who passed away on December 21, 2021. See Note 10 for additional information on deferred compensation.

FAIR VALUE OF FINANCIAL INSTRUMENTS — Cash equivalents, accounts receivable, and accounts payable approximate fair value based on the short maturity of these instruments. The Company’s investments are classified as held-to-maturity and reported at amortized cost on the Consolidated Balance Sheets. The fair value is based upon quoted market prices and is disclosed in Note 4.

IMPAIRMENT OF LONG-LIVED ASSETS — The Company evaluates the recoverability of the carrying amount of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. If an asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell. Management determines fair value using an undiscounted future cash flow analysis or other accepted valuation techniques. No impairments of the Company's long-lived assets were recorded in the years ended June 30, 2023 or 2022.

LEGAL COSTS — All legal costs related to litigation, for which the Company is liable, are charged to operations as incurred, except contingent legal fees as described below. Proceeds from the settlement of legal disputes are recorded in other income when the

amounts are determinable, and the collection is certain. License proceeds are considered functional and as such are recorded at a point in time, based on the underlying agreement. Related contingent legal fees and expenses are recorded in selling, general and

administrative expense at that time. Changes to the contingent legal fee expenses would cause a material impact to the results of operations.

STOCK-BASED COMPENSATION — The Company has a stock-based employee compensation plan, which is described more fully in Note 12. The Company accounts for stock-based compensation in accordance with ASC 718 "Compensation - Stock Compensation". Under the fair value recognition provisions of this statement, share-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the vesting period.

OTHER INCOME — The Company maintains a program focused on enforcing its intellectual property and, in particular, certain of its patent portfolio, by filing complaints against certain parties alleging infringement on the Company’s patents relating to its wireless headphone technology. The Company has granted license agreements related to certain patents allowing the Company to recover certain of the fees and costs that were involved with the underlying efforts to enforce this portfolio. In the years ended June 30, 2023 and 2022, the Company received licensing proceeds of $33,000,000 and $100,000, respectively, which were recorded as other income.

In the year ended June 30, 2022, the Company also recognized approximately $262,000 of other income related to the proceeds from company-owned life insurance policies on its founder, who passed away on December 21, 2021.

USE OF ESTIMATES — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenue and expenses during the reported periods. Actual results could differ from those estimates.

Stock Options (Nonvested Option Activity) (Details) - $ / shares	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Stock Options [Abstract]
Non-vested (in shares)	794,334	1,460,000
Vested (in shares)	(354,668)	(515,666)
Forfeited (in shares)	(51,000)	(150,000)
Non-vested (in shares)	388,666	794,334
Non-vested, weighted average grant date fair value (in dollars per share)	$ 1.22	$ 1.23
Vested, weighted average grant date fair value (in dollars per share)	1.26	1.20
Forfeited, weighted average grant date fair value (in dollars per share)	1.34	1.38
Non-vested, weighted average grant date fair value (in dollars per share)	$ 1.17	$ 1.22

Equipment and Leasehold Improvements (Summary of Major Categories of Equipment and Leasehold Improvements) (Details) - USD ($)	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 8,779,972	$ 8,828,654
Less: accumulated depreciation and amortization	7,826,069	7,740,637
Equipment and leasehold improvements, net	953,903	1,088,017
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 619,064	601,315
Machinery and Equipment [Member] \| Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	5 years
Machinery and Equipment [Member] \| Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	10 years
Furniture and Office Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 337,419	337,419
Furniture and Office Equipment [Member] \| Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	5 years
Furniture and Office Equipment [Member] \| Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	10 years
Tooling [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 4,506,044	4,506,044
Computer & Technology Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 197,072	197,073
Computer & Technology Equipment [Member] \| Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	3 years
Computer & Technology Equipment [Member] \| Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	5 years
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 2,864,335	2,951,054
Leasehold Improvements [Member] \| Minimum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	3 years
Leasehold Improvements [Member] \| Maximum [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives (in years)	11 years
Assets in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 256,038	$ 235,749

Leases (Future Minimum Lease Payments) (Details)	Jun. 30, 2023 USD ($)
Leases [Abstract]
2024	$ 380,000
2025	380,000
2026	380,000
2027	380,000
2028	380,000
Thereafter	1,985,000
Total lease payments	3,885,000
Present value adjustment	(860,805)
Total lease liabilities	$ 3,024,195

Income per Common and Common Stock Equivalent Share (Tables)

12 Months Ended

Jun. 30, 2023

Income per Common and Common Stock Equivalent Share [Abstract]

Reconciliation of Numerator and Denominator Used to Calculate Basic and Diluted Income per Share


		Year Ended
	2023		2022
Numerator
Net income	$	8,302,380	$	1,268,409

Denominator
Weighted average shares, basic		9,192,799		9,070,277
Dilutive effect of stock compensation awards (1)		560,961		915,385
Diluted shares		9,753,760		9,985,662

Net income attributable to common shareholders per share:
Basic	$	0.90	$	0.14
Diluted	$	0.85	$	0.13

(1) No exercised stock options were anti-dilutive for the years ended June 20, 2023 and 2022.

Revenue Recognition (Narrative) (Details) - USD ($)	12 Months Ended
Revenue Recognition (Narrative) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2021
Disaggregation of Revenue [Line Items]
Revenue recognized	$ 338,529	$ 453,693
Deferred revenue liability			$ 883,564
Domestic sales [Member]
Disaggregation of Revenue [Line Items]
Remaining performance obligation, percentage	2.40%	3.00%
Export sales [Member]
Disaggregation of Revenue [Line Items]
Remaining performance obligation, percentage	10.00%	14.00%
Minimum [Member]
Disaggregation of Revenue [Line Items]
Contract with customer liability remaining performance obligation expected timing of satisfaction period	1 year
Maximum [Member]
Disaggregation of Revenue [Line Items]
Contract with customer liability remaining performance obligation expected timing of satisfaction period	3 years

Deferred Compensation

12 Months Ended

Jun. 30, 2023

Deferred Compensation [Abstract]

Deferred Compensation

10. DEFERRED COMPENSATION

As of June 30, 2023 and 2022, the Company has a deferred compensation agreement with a current officer. The related expense is calculated using the net present value of the expected payments and is included in selling, general and administrative expenses in the Consolidated Statements of Income. The Company's non-current deferred compensation obligation is included in deferred compensation in the Consolidated Balance Sheets.

Deferred compensation income of $472,883 was recognized in selling, general and administrative expenses during the year ended June 30, 2022 when the deferred compensation liability related to the deferred compensation arrangement with Company’s founder and former chairman was relieved upon his passing on December 21, 2021. Payments of $71,250 made to the former chairman during the period before his passing partially offset the income.

The deferred compensation liability of $1,997,120 and $1,937,229 recorded at June 30, 2023 and June 30, 2022, respectively, relates to a supplemental retirement plan for a current officer that calls for annual cash compensation following retirement from the Company in an amount equal to 2% of base salary, as defined in the agreement, multiplied by the number of years of service to the Company. The retirement payments are to be paid monthly to the officer until his death and then to his surviving spouse monthly until her death. Deferred compensation expense/(income) of $59,891 and ($231,370) was recognized under this arrangement during the years ended June 30, 2023 and 2022, respectively, to record the liability at net present value of the future expected payments. The net present value was calculated using a discount factor of 5.21% and 4.78% at June 30, 2023 and 2022, respectively. The life expectancies used in the calculation of net present value were 18.90 and 19.70 years for fiscal years ended June 30, 2023 and 2022, respectively. The current officer's retirement date is estimated to be October 2029.

Leases (Narrative) (Details)	12 Months Ended
Leases (Narrative) (Details)	Jun. 30, 2023 USD ($)
Lessee, Lease, Description [Line Items]
Lease renewal term	5 years
Lease extension per year	$ 380,000
Additional Renewal [Member]
Lessee, Lease, Description [Line Items]
Lease extension per year	$ 397,000

Employee Benefit Plans

12 Months Ended

Jun. 30, 2023

Employee Benefit Plans [Abstract]

Employee Benefit Plans

16. EMPLOYEE BENEFIT PLANS

Substantially all domestic employees are participants in the Koss Employee Stock Ownership Trust ("KESOT") under which an annual contribution in either cash or common stock may be made at the discretion of the Board of Directors. No contributions were made for the fiscal years 2023 or 2022.

The Company maintains a retirement savings plan under Section 401(k) of the Internal Revenue Code. This plan covers all employees of the Company who have completed one full fiscal quarter of service. Matching contributions can be made at the discretion of the Board of Directors. For fiscal years 2023 and 2022, the matching contribution was 25% of employee contributions to the plan. Vesting of Company contributions occurs immediately. Company contributions were $92,986 and $89,314 during 2023 and 2022, respectively.

Inventories

12 Months Ended

Jun. 30, 2023

Inventories [Abstract]

Inventories

5. INVENTORIES

The components of inventories at June 30, 2023 and 2022 were as follows:


		2023		2022
Raw materials	$	2,071,360	$	2,217,621
Finished goods		6,178,186		8,302,546
Inventories, gross		8,249,546		10,520,167
Reserve for obsolete inventory		(1,826,105)		(1,888,805)
Inventories, net	$	6,423,441	$	8,631,362

Accrued Liabilities (Schedule of Accrued Liabilities) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Accrued Liabilities [Abstract]
Cooperative advertising and promotion allowances	$ 77,181	$ 200,175
Customer credit balances	281,780	30,515
Employee benefits	76,323	75,101
Legal and professional fees	85,500	86,500
Bonus and profit-sharing	369,529	91,784
Sales commissions and bonuses	46,857	39,195
Other	33,360	37,086
Total accrued liabilities	$ 970,530	$ 560,356

Legal Matters (Narrative) (Details) - USD ($)	12 Months Ended
Legal Matters (Narrative) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Legal Matters [Abstract]
Licensing proceeds	$ 33,000,000	$ 100,000
Legal fees and related expenses	22,141,000
Income from operations	(24,901,052)	902,023
Estimate of loss	41,000
Accrual	$ 41,000	$ 41,000

Income Taxes (Schedule Of Deferred Income Tax Assets and Liabilities) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2021
Income Taxes [Abstract]
Deferred compensation	$ 491,608	$ 479,340
Stock-based compensation	117,607	107,499
Accrued expenses and reserves	571,719	551,562
Deferred revenue	138,665	176,447
Federal and state net operating loss carryforwards	8,216,671	9,942,511
IRC Section 174 research and development costs	63,855
Credit carryforwards	169,552	292,155
Equipment and leasehold improvements	136,294	122,764
Lease liability	744,431	803,603
Valuation allowance	(9,906,018)	(11,671,606)	$ (10,185,605)
Total deferred income tax assets	744,384	804,275
ROU asset	(742,386)	(803,603)
Other	(1,998)	(672)
Net deferred income tax assets

Investments

12 Months Ended

Jun. 30, 2023

Investments [Abstract]

Investments

4. INVESTMENTS

The following table summarizes the unrealized positions for the held-to-maturity debt securities as of June 30, 2023:

TThe


	Amortized cost basis		Gross unrealized gains		Gross unrealized losses		Fair Value
US Treasury securities	$	17,064,274	$	—	$	93,740	$	16,970,534
Total	$	17,064,274	$	—	$	93,740	$	16,970,534

There were no investments held at June 30, 2022.

The following table summarizes the fair value and amortized cost basis of the held-to-maturity debt securities by contractual maturity as of June 30, 2023:


	Amortized Cost Basis		Fair value
Due within one year	$	17,064,274	$	16,970,534
Total	$	17,064,274	$	16,970,534

Stock Options (Narrative) (Details) - USD ($)	12 Months Ended
Stock Options (Narrative) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount, Total	$ 195,205
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition (Year)	1 year 3 months 29 days
Stock or Unit Option Plan Expense	$ 289,676	$ 463,633
The 2023 Omnibus Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized (in shares)	2,000,000
The 2023 Omnibus Incentive Plan [Member] \| Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)	3 years
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year)	5 years
The 2023 Omnibus Incentive Plan [Member] \| Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period (Year)	5 years
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period (Year)	10 years

Equipment and Leasehold Improvements (Tables)

12 Months Ended

Jun. 30, 2023

Equipment and Leasehold Improvements [Abstract]

Summary of Major Categories of Equipment and Leasehold Improvements



	Estimated useful lives (in years)		2023		2022
Machinery and equipment	5 - 10	$	619,064	$	601,315
Furniture and office equipment	5 - 10		337,419		337,419
Tooling	5		4,506,044		4,506,044
Computer & technology equipment	3 - 5		197,072		197,073
Leasehold improvements	3 - 11		2,864,335		2,951,054
Assets in progress	N/A		256,038		235,749
			8,779,972		8,828,654
Less: accumulated depreciation and amortization			7,826,069		7,740,637
Equipment and leasehold improvements, net		$	953,903	$	1,088,017

Related Party Transactions (Narrative) (Details) - USD ($)	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Koss Foundation [Member]
Related Party Transaction [Line Items]
Related party transaction amount	$ 75,000	$ 4,000

Recent Accounting Pronouncements

12 Months Ended

Jun. 30, 2023

Recent Accounting Pronouncements [Abstract]

Recent Accounting Pronouncements

2. RECENT ACCOUNTING PRONOUNCEMENTS

In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The standard’s main goal is to improve financial reporting by requiring earlier recognition of credit losses on financing receivables and other financial assets, including accounts and notes receivables. The new guidance represents significant changes to accounting for credit losses. The current incurred loss impairment model that recognizes losses when a probable threshold is met will be replaced with the expected credit loss impairment method without recognition threshold. The expected credit losses estimate will be based upon historical information, current conditions, and reasonable and supportable forecasts. On November 15, 2019, the FASB delayed the effective date of FASB ASC Topic 326 for certain smaller public companies and other private companies. As amended, the effective date of ASC Topic 326 was delayed until fiscal years beginning after December 15, 2022 for SEC filers that are eligible to be smaller reporting companies under the SEC’s definition. As such, ASC Topic 326 will be effective for the Company for the fiscal year ending June 30, 2024. Management is currently assessing the impact of the adoption of this standard on the Company’s financial statements.

- Definition

The entire disclosure for change in accounting principle. Includes, but is not limited to, nature, reason, and method of adopting amendment to accounting standards or other change in accounting principle.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Consolidated Statements of Stockholders' Equity - USD ($)	Common Stock [Member]	Paid in Capital [Member]	Retained Earnings [Member]	Total
Balance (in shares) at Jun. 30, 2021	8,608,706
Balance at Jun. 30, 2021	$ 43,044	$ 10,802,118	$ 8,729,939	$ 19,575,101
Net income			1,268,409	1,268,409
Stock-based compensation expense		463,633		$ 463,633
Exercise of common stock options (in shares)	539,089			539,089
Exercise of common stock options	$ 2,695	1,387,651		$ 1,390,346
Balance at Jun. 30, 2022	$ 45,739	12,653,402	9,998,348	$ 22,697,489
Balance (in shares) at Jun. 30, 2022	9,147,795			9,147,795
Net income			8,302,380	$ 8,302,380
Stock-based compensation expense		289,676		$ 289,676
Exercise of common stock options (in shares)	87,000			87,000
Exercise of common stock options	$ 435	170,915		$ 171,350
Balance at Jun. 30, 2023	$ 46,174	$ 13,113,993	$ 18,300,728	$ 31,460,895
Balance (in shares) at Jun. 30, 2023	9,234,795			9,234,795

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

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Income per Common and Common Stock Equivalent Share (Reconciliation of Numerator and Denominator Used to Calculate Basic and Diluted Income per Share) (Details) - USD ($)	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Income per Common and Common Stock Equivalent Share [Abstract]
Net income	$ 8,302,380	$ 1,268,409
Weighted average shares, basic (in shares)	9,192,799	9,070,277
Dilutive effect of stock compensation awards (in shares)	560,961	915,385
Diluted shares (in shares)	9,753,760	9,985,662
Basic (in dollars per share)	$ 0.90	$ 0.14
Diluted (in dollars per share)	$ 0.85	$ 0.13
Anti-dilutive shares	0	0

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The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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+ Details

- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

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- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details

Stock Options

12 Months Ended

Jun. 30, 2023

Stock Options [Abstract]

Stock Options

12. STOCK OPTIONS

As of July 25, 2022, the tenth anniversary of the Company’s 2012 Omnibus Incentive Plan (the “2012 Plan”), the 2012 Plan expired. A new plan (the “2023 Plan”) was approved by the Board of Directors on July 26, 2023, and will be proposed to be approved by the shareholders at the Company’s Annual Meeting in October 2023. The 2023 Plan will be administered by the Compensation Committee of the Board of Directors and provide for the granting of various stock-based incentive awards to eligible participants, primarily officers and certain key employees of the Company. If approved, the 2023 Plan will have 2,000,000 shares of common stock available for issuance thereunder, plus any shares subject to awards remaining outstanding under the 2012 Plan that expired or are otherwise forfeited, canceled, or terminated. The Company expects that stock options granted under the 2023 Plan would vest over a three-to-five-year period from the date of grant and have a maximum term of five to ten years. As with the 2012 Plan, pursuant to the 2023 Plan new shares will be issued upon exercise of stock options.

The fair value of each stock option grant under the 2012 Plan was estimated as of the date of grant using the Black-Scholes pricing model. The resulting compensation cost for fixed awards with graded vesting schedules is amortized on a straight-line basis over the vesting period for the entire award. Forfeitures are accounted for as they occur. The expected term of awards granted was determined based on historical experience with similar awards, giving consideration to the expected term and vesting schedules. The expected volatility was determined based on the Company’s historical stock prices over the most recent period commensurate with the expected term of the award. The risk-free interest rate was based on U.S. Treasury zero-coupon issues with a remaining term commensurate with the expected term of the award.

As of June 30, 2023, there was $195,205 of total unrecognized compensation cost related to stock options granted under the 2012 Plan. This cost is expected to be recognized over a weighted average period of 1.33 years. The Company recognized stock-based compensation expense of $289,676 and $463,633 in 2023 and 2022, respectively. These expenses were included in selling, general and administrative expenses.

Options were granted at a price equal to or greater than the market value of the common stock on the date of grant. The fair value of each option granted is estimated on the date of grant using the Black-Scholes option-pricing model. No options were granted during the years ended June 30, 2023 and 2022.

The following table identifies options granted, exercised, canceled, or available for exercise pursuant to the 2012 Plan:


							Aggregate
						Weighted	Intrinsic
				Weighted		Average	Value of
		Stock		Average		Remaining	In-The-
	Number of	Options		Exercise		Contractual	Money
	Shares	Price Range		Price		Life - Years	Options
Shares under option at June 30, 2021	1,748,000	$	1.73 - $6.00	$	2.29	4.86	$	36,594,280
Granted	—	$	—	$	—
Exercised	(539,089)	$	1.73 - $6.00	$	2.58
Expired	—	$	—	$	—
Forfeited	(150,000)	$	1.73 - $2.65	$	2.00
Shares under option at June 30, 2022	1,058,911	$	1.73 - $2.92	$	2.18	3.72	$	5,055,797
Granted	—	$	—	$	—
Exercised	(87,000)	$	1.73 - $2.65	$	1.97
Expired	—	$	—	$	—
Forfeited	(51,000)	$	1.73 - $2.65	$	1.92
Shares under option at June 30, 2023	920,911	$	1.73 - $2.92	$	2.21	2.21	$	1,373,117
Exercisable as of June 30, 2022	264,577	$	1.73 - $2.92	$	2.45	2.06	$	1,180,591
Exercisable as of June 30, 2023	532,245	$	1.73 - $2.92	$	2.38	1.30	$	700,947

The aggregate intrinsic value of outstanding and exercisable stock options is defined as the difference between the market value of the Company's stock on any given date and the exercise price, multiplied by the number of in-the-money outstanding and exercisable stock options.

A summary of intrinsic value and cash received from stock option exercises and fair value of vested stock options for the fiscal years ended June 30, 2023 and 2022 is as follows:


	2023		2022
Total intrinsic value of stock options exercised	$	371,714	$	9,032,778
Cash received from stock option exercises	$	171,350	$	1,390,346
Total fair value of stock options vested	$	448,476	$	620,018
Total recognized tax benefit	$	77,328	$	1,778,981


			Weighted
			Average
			Grant Date
	Shares		Fair Value
Non-vested as of June 30, 2021	1,460,000	$	1.23
Granted	—		—
Vested	(515,666)		1.20
Forfeited	(150,000)		1.38
Non-vested as of June 30, 2022	794,334		1.22
Granted	—		—
Vested	(354,668)		1.26
Forfeited	(51,000)		1.34
Non-vested as of June 30, 2023	388,666	$	1.17

Stock Options (Intrinsic Value) (Details) - USD ($)	12 Months Ended
Stock Options (Intrinsic Value) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Stock Options [Abstract]
Total intrinsic value of stock options exercised	$ 371,714	$ 9,032,778
Cash received from stock option exercises	171,350	1,390,346
Total fair value of stock options vested	448,476	620,018
Total recognized tax benefit	$ 77,328	$ 1,778,981

Leases (Lease Expense) (Details) - USD ($)	12 Months Ended
Leases (Lease Expense) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Leases [Abstract]
Operating lease cost	$ 387,669	$ 380,000
Operating cash flows from operating leases	$ (380,000)	$ (380,000)
Weighted-average remaining lease term (in years)	10 years	11 years
Weighted-average discount rate	5.25%	5.25%

Investments (Summary of Held-to-Maturity Debt Securities by Contractual Maturity) (Details)	Jun. 30, 2023 USD ($)
Amortized cost basis
Due within one year	$ 17,064,274
Amortized cost basis	17,064,274
Fair Value
Due within one year	16,970,534
Fair Value	$ 16,970,534

Concentrations

12 Months Ended

Jun. 30, 2023

Concentrations [Abstract]

Concentrations

17. CONCENTRATIONS

In the years ended June 30, 2023 and 2022, the Company’s largest concentration of sales came from direct-to-consumer through the Amazon portal and were approximately 20% and 16% of net sales in fiscal year 2023 and 2022, respectively. The five largest customers of the Company accounted for approximately 51% of net sales in fiscal year 2023 and 44% in fiscal year 2022.

The three customers with individual accounts receivable balances greater than 10% as of June 30, 2023 and 2022 were Eurostar, Ingram Micro and Amazon Vendor Central. Accounts receivable from Eurostar represented 24% of total trade accounts receivable as of June 30, 2023. As of June 30, 2022, there was no receivable from Eurostar. Ingram Micro accounts receivable as of June 30, 2023 and 2022, were approximately 14% and 19% of total trade account receivables, respectively. Amazon Vendor Central accounts receivables were approximately 13% and 18% of total trade account receivables as of June 30, 2023 and 2022, respectively. The majority of international customers, outside of Canada, purchase products on a cash against documents or cash in advance basis. Approximately 24% and 4% of the Company's trade accounts receivable at June 30, 2023 and 2022, were foreign receivables denominated in U.S. dollars.

The Company uses contract manufacturing facilities in the People’s Republic of China. The majority of the contract manufacturing is done by two vendors with one vendor representing approximately 59% of the manufacturing costs in fiscal year 2023 and 2022. The Company has a long-term relationship with this vendor. However, increased costs from the vendor or an interruption of supply from this vendor could have a material adverse effect on the Company's profit margins and profitability.

‎

Equipment and Leasehold Improvements

12 Months Ended

Jun. 30, 2023

Equipment and Leasehold Improvements [Abstract]

Equipment and Leasehold Improvements

6. EQUIPMENT AND LEASEHOLD IMPROVEMENTS

The major categories of equipment and leasehold improvements at June 30, 2023 and 2022 are summarized as follows:



	Estimated useful lives (in years)		2023		2022
Machinery and equipment	5 - 10	$	619,064	$	601,315
Furniture and office equipment	5 - 10		337,419		337,419
Tooling	5		4,506,044		4,506,044
Computer & technology equipment	3 - 5		197,072		197,073
Leasehold improvements	3 - 11		2,864,335		2,951,054
Assets in progress	N/A		256,038		235,749
			8,779,972		8,828,654
Less: accumulated depreciation and amortization			7,826,069		7,740,637
Equipment and leasehold improvements, net		$	953,903	$	1,088,017

Consolidated Statements of Income - USD ($)	12 Months Ended
Consolidated Statements of Income - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Consolidated Statements of Income [Abstract]
Net sales	$ 13,099,651	$ 17,705,519
Cost of goods sold	8,642,237	10,989,889
Gross profit	4,457,414	6,715,630
Selling, general and administrative expenses	29,358,466	5,813,607
Income (loss) from operations	(24,901,052)	902,023
Other income	33,000,000	362,390
Interest income	520,809	11,513
Income before income tax provision	8,619,757	1,275,926
Income tax provision	317,377	7,517
Net income	$ 8,302,380	$ 1,268,409
Income per common share:
Basic (in dollars per share)	$ 0.90	$ 0.14
Diluted (in dollars per share)	$ 0.85	$ 0.13
Weighted-average number of shares:
Basic (in shares)	9,192,799	9,070,277
Diluted (in shares)	9,753,760	9,985,662

Inventories (Components of Inventories) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Inventories [Abstract]
Raw materials	$ 2,071,360	$ 2,217,621
Finished goods	6,178,186	8,302,546
Inventories, gross	8,249,546	10,520,167
Reserve for obsolete inventory	(1,826,105)	(1,888,805)
Inventories, net	$ 6,423,441	$ 8,631,362

Legal Matters

12 Months Ended

Jun. 30, 2023

Legal Matters [Abstract]

Legal Matters

18. LEGAL MATTERS

As of June 30, 2023, the Company is involved in the following matters described below:

As previously reported, the Company has launched a program focused on enforcing its intellectual property and, in particular, certain of its patent portfolio. The Company has continued to enforce its intellectual property by filing complaints against certain parties alleging infringement on the Company’s patents relating to its wireless audio technology. In the event that a monetary award or judgment is received by the Company in connection with these complaints, all or portions of such amounts will be due to third parties. The Company may incur additional fees and costs related to these lawsuits, however, timing and impact on its financial statements is uncertain. Depending on the response to and the underlying results of the enforcement program, the Company may continue to litigate its claims, enter into licensing arrangements or reach some other outcome potentially advantageous to its competitive position. During the year ended June 30, 2023, in connection with its intellectual property enforcement program, the Company granted a license covering certain of its patents and recognized gross proceeds of $33,000,000, which were recorded as other income, offset by legal fees and related expenses of approximately $22,141,000 which were recorded as selling, general and administrative expenses. Also, on August 4, 2023, the Company’s lawsuit against Plantronics, Inc. and Polycom, Inc. was dismissed following resolution of the litigation between the parties and had no impact on the Company’s financial statements.

The Company was notified by One-E-Way, Inc. that some of the Company's wireless products may infringe on certain One-E-Way patents. No lawsuits involving these allegations have yet been filed and served on the Company. The Company is currently investigating whether these allegations have any merit. Depending on the results of the investigation and the defense of these allegations, the ultimate resolution of this matter may have a material effect on the Company's financial statements. The Company estimates that this matter will ultimately be resolved at a cost of approximately $41,000 and has accrued this amount as of June 30, 2023 and 2022.

The ultimate resolution of these matters is not determinable unless otherwise noted.

We also are subject to a variety of other claims and suits that arise from time to time in the ordinary course of our business. Although management currently believes that resolving these claims against us, individually or in aggregate, will not have a material adverse impact on our Consolidated Financial Statements, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future.

Income Tax (Schedule Of Change In Valuation Allowance) (Details) - USD ($)	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Income Taxes [Abstract]
Balance, beginning of year	$ (11,671,606)	$ (10,185,605)
Decrease (Increase) in valuation allowance	1,765,588	(1,486,001)
Balance, end of year	$ (9,906,018)	$ (11,671,606)

Revenue Recognition (Disaggregation of Revenue) (Details) - USD ($)	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Disaggregation of Revenue [Line Items]
Net Sales	$ 13,099,651	$ 17,705,519
United States [Member]
Disaggregation of Revenue [Line Items]
Net Sales	9,848,521	13,132,899
Export [Member]
Disaggregation of Revenue [Line Items]
Net Sales	$ 3,251,130	$ 4,572,620

- Definition

Amount, including tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value-added and excise.

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+ Details

Investments (Summary of Unrealized Positions for Held-to-Maturity Debt Securities) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Schedule of Held-to-Maturity Securities [Line Items]
Amortized cost basis	$ 17,064,274
Gross unrealized losses	93,740
Fair Value	16,970,534
Short-term investments	17,064,274
Investments		$ 0
US Treasury Securities [Member]
Schedule of Held-to-Maturity Securities [Line Items]
Amortized cost basis	17,064,274
Gross unrealized losses	93,740
Fair Value	$ 16,970,534

Income Taxes (Tables)

12 Months Ended

Jun. 30, 2023

Income Taxes [Abstract]

Components of Income Tax (Benefit) Provision


Year Ended June 30,	2023		2022
Current:
Federal	$	230,139	$	—
State		87,238		7,517
Deferred		—		—
Total income tax provision	$	317,377	$	7,517

Effective Income Tax Rate Reconciliation


Year Ended June 30,	2023		2022
Federal income tax liability at statutory rate	$	1,803,000	$	267,945
State income tax liability, net of federal income tax effect		323,565		47,765
Utilization of net operating loss carryforwards		(1,720,747)		—
(Decrease) increase in valuation allowance		(44,841)		1,486,001
Stock option (deduction)		(24,218)		(1,966,822)
Non-deductible officers' compensation		—		127,612
All other permanent items		(41,701)		(50,573)
R&D credit		(19,340)		(34,936)
Return-to-provision		(54,414)		(38,863)
Expiration of stock options and tax credits		—		7,573
State tax rate change		83,094		157,716
Uncertain tax position		25,269		—
Other		(12,290)		4,099
Total income tax provision	$	317,377	$	7,517

Schedule of Deferred Income Tax Assets and Liabilities


	2023		2022
Deferred income tax assets:
Deferred compensation	$	491,608	$	479,340
Stock-based compensation		117,607		107,499
Accrued expenses and reserves		571,719		551,562
Deferred revenue		138,665		176,447
Federal and state net operating loss carryforwards		8,216,671		9,942,511
IRC Section 174 research and development costs		63,855		—
Credit carryforwards		169,552		292,155
Equipment and leasehold improvements		136,294		122,764
Lease liability		744,431		803,603
Valuation allowance		(9,906,018)		(11,671,606)
Total deferred income tax assets		744,384		804,275

Equipment and leasehold improvements		—		—
ROU asset		(742,386)		(803,603)
Other		(1,998)		(672)
Net deferred income tax assets	$	-	$	-

Schedule of Change in Valuation Allowance


	Balance,		Decrease (Increase)
	beginning		in valuation		Balance,
Year Ended June 30,	of year		allowance		end of year
2023	$	(11,671,606)	$	1,765,588	$	(9,906,018)
2022	$	(10,185,605)	$	(1,486,001)	$	(11,671,606)

Concentrations (Narrative) (Details) - customer	12 Months Ended
Concentrations (Narrative) (Details) - customer	Jun. 30, 2023	Jun. 30, 2022
Customer Concentration Risk [Member] \| Accounts Receivable [Member]
Concentration Risk [Line Items]
Number of major customers	3	3
Customer Concentration Risk [Member] \| Accounts Receivable [Member] \| Ingram Micro Member
Concentration Risk [Line Items]
Concentration risk percentage	14.00%	19.00%
Customer Concentration Risk [Member] \| Accounts Receivable [Member] \| Amazon Member
Concentration Risk [Line Items]
Concentration risk percentage	13.00%	18.00%
Customer Concentration Risk [Member] \| Accounts Receivable [Member] \| Eurostar [Member]
Concentration Risk [Line Items]
Concentration risk percentage	24.00%	0.00%
Customer Concentration Risk [Member] \| Revenue Benchmark [Member] \| Ingram Micro Member
Concentration Risk [Line Items]
Concentration risk percentage	20.00%	16.00%
Customer Concentration Risk [Member] \| Revenue Benchmark [Member] \| Five Largest Clients Member
Concentration Risk [Line Items]
Number of major vendors	5	5
Concentration risk percentage	51.00%	44.00%
Geographic Concentration Risk [Member] \| Trade Accounts Receivable [Member] \| Foreign Member
Concentration Risk [Line Items]
Concentration risk percentage	24.00%	4.00%
Geographic Concentration Risk [Member] \| Manufacturing Costs Benchmark Member \| China [Member]
Concentration Risk [Line Items]
Concentration risk percentage	59.00%

Investments (Tables)

12 Months Ended

Jun. 30, 2023

Investments [Abstract]

Summary of Unrealized Positions for Held-to-Maturity Debt Securities


	Amortized cost basis		Gross unrealized gains		Gross unrealized losses		Fair Value
US Treasury securities	$	17,064,274	$	—	$	93,740	$	16,970,534
Total	$	17,064,274	$	—	$	93,740	$	16,970,534

Summary of Held-to-Maturity Debt Securities by Contractual Maturity


	Amortized Cost Basis		Fair value
Due within one year	$	17,064,274	$	16,970,534
Total	$	17,064,274	$	16,970,534

Leases (Tables)

12 Months Ended

Jun. 30, 2023

Leases [Abstract]

Lease Expense


		Year Ended
	2023		2022
Operating lease cost	$	387,669	$	380,000
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	(380,000)	$	(380,000)
Weighted-average remaining lease term (in years)		10		11
Weighted-average discount rate		5.25%		5.25%

Future Minimum Lease Payments


Year Ending June 30,
2024	$	380,000
2025		380,000
2026		380,000
2027		380,000
2028		380,000
Thereafter		1,985,000
Total lease payments		3,885,000
Present value adjustment		(860,805)
Total lease liabilities	$	3,024,195

Consolidated Balance Sheets - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Current assets:
Cash and cash equivalents	$ 3,091,062	$ 9,208,170
Short-term investments	17,064,274
Accounts receivable, less allowance for doubtful accounts of $6,027 and $2,027, respectively	1,379,517	1,846,620
Inventories	6,423,441	8,631,362
Prepaid expenses and other current assets	284,622	188,478
Interest receivable	51,150
Income tax receivable	86,901	3,085
Total current assets	28,380,967	19,877,715
Equipment and leasehold improvements, net	953,903	1,088,017
Other assets:
Operating lease right-of-use asset	3,015,887	3,247,725
Cash surrender value of life insurance	6,020,048	5,744,724
Total other assets	9,035,935	8,992,449
Total assets	38,370,805	29,958,181
Current liabilities:
Accounts payable	267,513	796,163
Accrued liabilities	970,530	560,356
Deferred revenue	450,312	543,891
Operating lease liability	236,225	223,530
Income taxes payable	87,237	6,118
Total current liabilities	2,011,817	2,130,058
Long-term liabilities:
Deferred compensation	1,997,120	1,937,229
Deferred revenue	113,003	169,210
Operating lease liability	2,787,970	3,024,195
Total long-term liabilities	4,898,093	5,130,634
Total liabilities	6,909,910	7,260,692
Stockholders' equity:
Common stock, $0.005 par value, authorized 20,000,000 shares; issued and outstanding 9,234,795 and 9,147,795 shares, respectively	46,174	45,739
Paid in capital	13,113,993	12,653,402
Retained earnings	18,300,728	9,998,348
Total stockholders' equity	31,460,895	22,697,489
Total liabilities and stockholders' equity	$ 38,370,805	$ 29,958,181

Income Taxes

12 Months Ended

Jun. 30, 2023

Income Taxes [Abstract]

Income Taxes

7. INCOME TAXES

The Company utilizes the liability method of accounting for income taxes. The liability method measures the expected income tax impact of future taxable income and deductions implicit in the Consolidated Balance Sheets. The income tax provision in 2023 and 2022 consisted of the following:


Year Ended June 30,	2023		2022
Current:
Federal	$	230,139	$	—
State		87,238		7,517
Deferred		—		—
Total income tax provision	$	317,377	$	7,517

The 2023 and 2022 tax results in an effective rate different than the federal statutory rate because of the following:


Year Ended June 30,	2023		2022
Federal income tax liability at statutory rate	$	1,803,000	$	267,945
State income tax liability, net of federal income tax effect		323,565		47,765
Utilization of net operating loss carryforwards		(1,720,747)		—
(Decrease) increase in valuation allowance		(44,841)		1,486,001
Stock option (deduction)		(24,218)		(1,966,822)
Non-deductible officers' compensation		—		127,612
All other permanent items		(41,701)		(50,573)
R&D credit		(19,340)		(34,936)
Return-to-provision		(54,414)		(38,863)
Expiration of stock options and tax credits		—		7,573
State tax rate change		83,094		157,716
Uncertain tax position		25,269		—
Other		(12,290)		4,099
Total income tax provision	$	317,377	$	7,517

For the year ended June 30, 2023, as a result of additional income generated by licensing fees, partially offset by related legal fees and expenses, taxable income for the period was generated. On December 22, 2017, the Tax Cuts and Jobs Act (“TCJA”) was enacted which changed the rules for deducting net operating losses (NOLs). Before 2017, NOLs were fully deductible and could be carried back two years and carried forward 20 years. For NOLs arising in tax years beginning after December 31, 2017, the TCJA limits the NOL deduction to 80 percent of taxable income. As such, the utilization of the Company’s net operating loss carryforwards from fiscal years after 2018 were limited to 80 percent of the resulting taxable income. The Company’s NOL carryforwards from fiscal 2017 and 2018 could be utilized to offset taxable income at 100 percent. The utilization of net operating loss carryforwards significantly reduced the taxable income, resulting in federal and state tax provisions of $230,139 and $87,238, respectively, for the year ended June 30, 2023. For the year ended June 30, 2022, a state tax provision of $7,517 was recorded. The federal income tax expense was zero for the year ended June 30, 2022.

Temporary differences which give rise to deferred income tax assets and liabilities at June 30, 2023 and June 30, 2022 include:


	2023		2022
Deferred income tax assets:
Deferred compensation	$	491,608	$	479,340
Stock-based compensation		117,607		107,499
Accrued expenses and reserves		571,719		551,562
Deferred revenue		138,665		176,447
Federal and state net operating loss carryforwards		8,216,671		9,942,511
IRC Section 174 research and development costs		63,855		—
Credit carryforwards		169,552		292,155
Equipment and leasehold improvements		136,294		122,764
Lease liability		744,431		803,603
Valuation allowance		(9,906,018)		(11,671,606)
Total deferred income tax assets		744,384		804,275

Equipment and leasehold improvements		—		—
ROU asset		(742,386)		(803,603)
Other		(1,998)		(672)
Net deferred income tax assets	$	-	$	-

Deferred income tax balances reflect the effects of temporary differences between the tax bases of assets and liabilities and their carrying amounts. These differences are stated at enacted tax rates expected to be in effect when taxes are actually paid or recovered. The recognition of these deferred tax balances will be realized through normal recurring operations and, as such, the Company has recorded the value of such expected benefits. The Company has federal net operating loss carryforwards of approximately $31,793,000 which can be carried forward indefinitely. The Company has state net operating loss carryforwards totaling approximately $10,944,000 in Wisconsin, which expire in tax years 2030 through 2041, and approximately $15,090,000 in other states. In the year ended June 30, 2023, the Company estimates that federal net operating loss carryforwards of approximately $7,006,000 will be utilized to offset taxable income. At the state level, net operating loss carryforwards of $4,565,000 in Wisconsin and all other states combined are expected to be utilized.

The Company's remaining tax loss carryforward as of June 30, 2023 is expected to be approximately $31,800,000. Taxable income was generated during the year ended June 30, 2023, mainly as a result of non-recurring license proceeds and, as such, the future realization of this continues to be uncertain. The valuation allowance was adjusted to continue to fully offset the deferred tax asset as there is sufficient negative evidence to support a full valuation allowance.

The need for a valuation allowance is evaluated each accounting period based on the Company’s evaluation of positive and negative evidence concerning the usage of their deferred tax assets. As of the end of the period, the Company has evaluated all evidence concerning the usage of their deferred tax assets and the determination has been made to maintain a full valuation allowance on the Company’s net deferred tax asset. The need for a valuation allowance is an estimate at period-end, which is subject to change once additional evidence is obtained in future periods.

Generally accepted accounting principles in the United States (“GAAP”) prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken, or expected to be taken, in a tax return. The Company recorded a liability of approximately $25,000 as a reserve for an uncertain tax position (“UTP”) related to the research and development credits taken. The reserve for UTP was recorded in income taxes receivable on the Consolidated Balance Sheet as of June 30, 2023. There were no other matters determined to be unrecognized tax benefits taken or expected to be taken in a tax return that have been recorded on the Company’s Consolidated Financial Statements for the years ended June 30, 2023 and 2022.

Additionally, GAAP provides guidance on the recognition of interest and penalties related to income taxes. No interest or penalties related to income taxes has been accrued or recognized as of and for the years ended June 30, 2023 or 2022. The Company records interest related to unrecognized tax benefits in interest expense.

The Company files income tax returns in the United States federal jurisdiction and in several state jurisdictions. The Company’s federal tax returns for tax years and state income tax returns are open for the standard statutory period.

The following are the changes in the valuation allowance:


	Balance,		Decrease (Increase)
	beginning		in valuation		Balance,
Year Ended June 30,	of year		allowance		end of year
2023	$	(11,671,606)	$	1,765,588	$	(9,906,018)
2022	$	(10,185,605)	$	(1,486,001)	$	(11,671,606)

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI https://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Deferred Compensation (Narrative) (Details) - USD ($)	12 Months Ended
Deferred Compensation (Narrative) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Former Officer [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Life expectancy	18 years 10 months 24 days	19 years 8 months 12 days
Deferred compensation expense (income)	$ 472,883
Current Officer [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Discount factor	5.21%	4.78%
Deferred compensation recorded liability	$ 1,997,120	$ 1,937,229
Deferred compensation expense (income)	$ 59,891	(231,370)
Cash compensation, percentage of base salary	2.00%
Chairman [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items]
Deferred compensation paid		$ 71,250

Stock Repurchase Program (Narrative) (Details) - USD ($)	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Stock Repurchase Program [Member]
Equity, Class of Treasury Stock [Line Items]
Stock Repurchase Program, Authorized Amount	$ 2,000,000
Stock Repurchase Program B [Member]
Equity, Class of Treasury Stock [Line Items]
Stock Repurchase Program, Authorized Amount	45,500,000
Stock Repurchase Program Additional Authorized Amount	$ 43,360,247
Stock Repurchased and Retired During Period, Shares (in shares)	0	0

Leases

12 Months Ended

Jun. 30, 2023

Leases [Abstract]

Leases

14. LEASES

The Company leases its facility in Milwaukee, Wisconsin from Koss Holdings, LLC, which is controlled by five equal ownership interests in trusts held by the five beneficiaries of the former Chairman’s revocable trust and includes current stockholders of the Company. On May 24, 2022, the lease was renewed for a period of five years, ending June 30, 2028 (the “Extended Term”), and is being accounted for as an operating lease. The lease extension maintained the rent at a fixed rate of $380,000 per year and included an option to renew at an increased rate of $397,000 for an additional five years ending June 30, 2033 (the “Second Extended Term”). The negotiated increase in rent slated for 2028 will be the first increase in rent since 1996. The Company is responsible for all property maintenance, insurance, taxes, and other normal expenses related to ownership.

The Company used its incremental borrowing rate as of the date of renewal, May 24, 2022, to recalculate the net present value of the operating lease ROU asset and liability. Both the Extended Term and the Second Extended Term renewal options were included in the calculation of the ROU asset and liability as the Company believes it is reasonably certain to exercise both rights to renew. The non-lease components of the agreement related to common area maintenance charges are accounted for separately.

Supplemental information related to lease expense and valuation of the ROU asset and liability was as follows:


		Year Ended
	2023		2022
Operating lease cost	$	387,669	$	380,000
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	(380,000)	$	(380,000)
Weighted-average remaining lease term (in years)		10		11
Weighted-average discount rate		5.25%		5.25%

The maturity schedule of future minimum lease payments and reconciliation to the operating lease liabilities reported on the 2023 Consolidated Balance Sheet is as follows:


Year Ending June 30,
2024	$	380,000
2025		380,000
2026		380,000
2027		380,000
2028		380,000
Thereafter		1,985,000
Total lease payments		3,885,000
Present value adjustment		(860,805)
Total lease liabilities	$	3,024,195

‎

Employee Benefit Plans (Narrative) (Details) - USD ($)	12 Months Ended
Employee Benefit Plans (Narrative) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Employee Benefit Plans [Abstract]
Contributions	$ 0	$ 0
Matching contributions, percent	25.00%	25.00%
Company contributions	$ 92,986	$ 89,314

Income Taxes (Effective Income Tax Rate Reconciliation) (Details) - USD ($)	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Income Taxes [Abstract]
Federal income tax liability at statutory rate	$ 1,803,000	$ 267,945
State income tax liability, net of federal income tax effect	323,565	47,765
Utilization of net operating loss carryforwards	(1,720,747)
(Decrease) increase in valuation allowance	(44,841)	1,486,001
Stock option (deduction)	(24,218)	(1,966,822)
Non-deductible officer's compensation		127,612
All other permanent items	(41,701)	(50,573)
R&D credit	(19,340)	(34,936)
Return-to-provision	(54,414)	(38,863)
Expiration of stock options and tax credits		7,573
State tax rate change	83,094	157,716
Uncertain tax position	25,269
Other	(12,290)	4,099
Total income tax provision (benefit)	$ 317,377	$ 7,517

Inventories (Tables)

12 Months Ended

Jun. 30, 2023

Inventories [Abstract]

Components of Inventories


		2023		2022
Raw materials	$	2,071,360	$	2,217,621
Finished goods		6,178,186		8,302,546
Inventories, gross		8,249,546		10,520,167
Reserve for obsolete inventory		(1,826,105)		(1,888,805)
Inventories, net	$	6,423,441	$	8,631,362

Income Taxes (Narrative) (Details) - USD ($)	12 Months Ended
Income Taxes (Narrative) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Income Tax Disclosure [Line Items]
Uncertainty tax position related to research and development costs	$ 25,000
Operating loss carryforwards	31,800,000
Interest and penalties	0	$ 0
Unrecognized tax benefits	0	0
Income Tax Expense (Benefit)	317,377	7,517
Wisconsin Department of Revenue [Member]
Income Tax Disclosure [Line Items]
Operating loss carryforwards	4,565,000
Federal [Member]
Income Tax Disclosure [Line Items]
Operating loss carryforwards, not subject to expiration	31,793,000
Operating loss carryforwards	7,006,000
Income Tax Expense (Benefit)	230,139	0
State and Local Jurisdiction [Member]
Income Tax Disclosure [Line Items]
Income Tax Expense (Benefit)	87,238	$ 7,517
State and Local Jurisdiction [Member] \| Wisconsin Department of Revenue [Member]
Income Tax Disclosure [Line Items]
Operating loss carryforwards, subject to expiration	10,944,000
State and Local Jurisdiction [Member] \| Other States [Member]
Income Tax Disclosure [Line Items]
Operating loss carryforwards, subject to expiration	$ 15,090,000

Accrued Liabilities

12 Months Ended

Jun. 30, 2023

Accrued Liabilities [Abstract]

Accrued Liabilities

9. ACCRUED LIABILITIES

Accrued liabilities as of June 30, 2023 and 2022 were as follows:


	2023		2022
Cooperative advertising and promotion allowances	$	77,181	$	200,175
Customer credit balances		281,780		30,515
Employee benefits		76,323		75,101
Legal and professional fees		85,500		86,500
Bonus and profit-sharing		369,529		91,784
Sales commissions and bonuses		46,857		39,195
Other		33,360		37,086
Total accrued liabilities	$	970,530	$	560,356

Income Taxes (Components Of Income Tax (Benefit) Provision) (Details) - USD ($)	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Income Taxes [Abstract]
Current: Federal	$ 230,139
Current: State	87,238	$ 7,517
Total income tax provision (benefit)	$ 317,377	$ 7,517

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Significant Accounting Policies (Narrative II) (Details)	Jun. 30, 2023
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01
Operating Loss Carryforwards [Line Items]
Revenue, Remaining Performance Obligation, Percentage	50.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-07-01
Operating Loss Carryforwards [Line Items]
Revenue, Remaining Performance Obligation, Percentage	30.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	2 years
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-07-01
Operating Loss Carryforwards [Line Items]
Revenue, Remaining Performance Obligation, Percentage	20.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	3 years

Revenue Recognition

12 Months Ended

Jun. 30, 2023

Revenue Recognition [Abstract]

Revenue Recognition

3. REVENUE RECOGNITION

The Company disaggregates its net sales by geographical location as it believes it best depicts how the nature, timing and uncertainty of net sales and cash flows are affected by economic factors. The following table summarizes net sales by geographical location:


	2023		2022
United States	$	9,848,521	$	13,132,899
Export		3,251,130		4,572,620
Net Sales	$	13,099,651	$	17,705,519

Deferred revenue relates primarily to consumer and customer warranties. These constitute future performance obligations, and the Company defers revenue related to these future performance obligations. Effective July 1, 2022, the Company decreased its rates from 3% to 2.4% for domestic sales and from 14% to 10% for export sales to reflect recent warranty experience. The Company recognized revenue, which was included in the deferred revenue liability at the beginning of the periods, of $338,529 and $453,693 in the years ended June 30, 2023 and 2022, respectively, for performance obligations related to consumer and customer warranties. The deferred revenue liability was $883,564 as of June 30, 2021. The Company estimates that the deferred revenue performance obligations are satisfied within 1 to 3 years and therefore uses the same time frame for recognition of the deferred revenue.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI https://asc.fasb.org/topic&trid=49130388

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 10
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130551-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130556-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130550-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 12
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 15
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130558-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130554-203045

+ Details

Related Party Transactions

12 Months Ended

Jun. 30, 2023

Related Party Transactions

15. RELATED PARTY TRANSACTIONS

During the year ended June 30, 2023, the Company made a charitable contribution of $75,000 to the Koss Foundation (the “Foundation”), a 501(c)(3) charitable organization for which Michael J. Koss and John C. Koss Jr., executive officers of the Company, serve as officers. Neither officer receives fees or compensation from the Foundation for holding these positions. There were approximately $4,000 of charitable contributions made to the Foundation during the year ended June 30, 2022.

Significant Accounting Policies (Narrative) (Details)	1 Months Ended	12 Months Ended
Significant Accounting Policies (Narrative) (Details)	Dec. 31, 2021 USD ($)	Jun. 30, 2023 USD ($) item	Jun. 30, 2022 USD ($)
Accounting Policies Disclosure [Line Items]
Income tax provision		$ 317,377	$ 7,517
Licensing proceeds		$ 33,000,000	100,000
Proceeds from life insurance policy	$ 262,000		2,014,184
Number of subsidiaries \| item		2
Referral fees		$ 43,190
Cost of goods sold		8,642,237	10,989,889
Research and development expense		288,231	285,244
Advertising expense		$ 65,374	50,513
Other income - Net gain from life insurance benefits			262,391
Revision of Prior Period, Reclassification, Adjustment [Member]
Accounting Policies Disclosure [Line Items]
Referral fees			98,252
Referral Fees [Member] \| Revision of Prior Period, Reclassification, Adjustment [Member]
Accounting Policies Disclosure [Line Items]
Cost of goods sold			$ (98,252)
Koss UK [Member]
Accounting Policies Disclosure [Line Items]
Ownership percentage		100.00%
Koss Corp B.V. [Member]
Accounting Policies Disclosure [Line Items]
Ownership percentage		100.00%

Stock Repurchase Program	12 Months Ended
Stock Repurchase Program	Jun. 30, 2023
Stock Repurchase Program [Abstract]
Stock Repurchase Program	13. STOCK REPURCHASE PROGRAM In April 1995, the Board of Directors approved a stock repurchase program authorizing the Company to purchase from time to time up to $2,000,000 of its common stock for its own account. Subsequently, the Board of Directors periodically approved increases in the amount authorized for repurchase under the program. As of June 30, 2023, the repurchase of an aggregate of $45,500,000 of common stock was authorized under the stock repurchase program, of which $43,360,247 had been expended. No shares were repurchased in fiscal year 2023 or 2022.

Revenue Recognition (Tables)

12 Months Ended

Jun. 30, 2023

Revenue Recognition [Abstract]

Disaggregation of Revenue


	2023		2022
United States	$	9,848,521	$	13,132,899
Export		3,251,130		4,572,620
Net Sales	$	13,099,651	$	17,705,519

Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
Consolidated Statements of Cash Flows - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Operating activities:
Net income	$ 8,302,380	$ 1,268,409
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Provision for (recovery of) doubtful accounts receivable	4,000	(35,305)
Depreciation of equipment and leasehold improvements	230,292	293,465
Accretion of discount on treasury securities	(226,603)
Noncash operating lease expense	8,308
Stock-based compensation expense	289,676	463,633
Change in cash surrender value of life insurance	(187,329)	(211,636)
Provision (benefit) for deferred compensation	59,891	(160,120)
Deferred compensation gain		(71,250)
Deferred compensation relieved		(472,883)
Other income - Net gain from life insurance benefits		(262,391)
Loss on disposal of fixed assets	2,263	7,856
Net changes in operating assets and liabilities:
Accounts receivable	463,103	429,470
Inventories	2,207,921	(2,729,850)
Prepaid expenses and other current assets	(96,144)	267,526
Interest receivable	(51,150)
Income taxes receivable	(83,816)
Income taxes payable	81,119	(1,510)
Accounts payable	(528,650)	397,730
Accrued liabilities	410,174	44,789
Deferred revenue	(149,786)	(170,463)
Net cash provided by (used in) operating activities	10,735,649	(942,530)
Investing activities:
Purchase of equipment and leasehold improvements	(98,441)	(108,158)
Life insurance premiums paid	(87,995)	(95,887)
Proceeds from life insurance policy		2,014,184
Proceeds from the maturity of treasury securities	2,022,000
Purchases of treasury securities	(18,859,671)
Net cash (used in) provided by investing activities	(17,024,107)	1,810,139
Financing activities:
Proceeds from exercise of stock options	171,350	1,390,346
Net cash provided by financing activities	171,350	1,390,346
Net (decrease) increase in cash and cash equivalents	(6,117,108)	2,257,955
Cash and cash equivalents at beginning of year	9,208,170	6,950,215
Cash and cash equivalents at end of year	3,091,062	$ 9,208,170
Supplemental cash flow information:
Cash paid for income taxes	$ 320,073

Significant Accounting Policies (Policies)	12 Months Ended
Significant Accounting Policies (Policies)	Jun. 30, 2023
Significant Accounting Policies [Abstract]
Nature of Business	NATURE OF BUSINESS — Koss Corporation ("Koss"), a Delaware corporation, and its 100%-owned subsidiaries (collectively the "Company"), reports its finances as a single reporting segment, as the Company’s only business line is the design, manufacture and sale of stereo headphones and related accessories. The Company leases its plant and office in Milwaukee, Wisconsin. The domestic market is served by domestic sales representatives and independent manufacturers' representatives working directly with certain retailers, distributors, and original equipment manufacturers. International markets are served by domestic sales representatives and sales personnel in the Netherlands and the Caucasus region which utilize independent distributors in several foreign countries. The Company has two subsidiaries, Koss Corp B.V. and Koss U.K. Limited ("Koss UK"), which were formed to comply with certain European Union ("EU") requirements. Koss Corp B.V. and Koss UK are non-operating and hold no assets.
Basis of Consolidation	BASIS OF CONSOLIDATION — The Consolidated Financial Statements include the accounts of Koss and its subsidiaries, Koss Corp B.V. and Koss UK, which are 100%-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated.
Revenue Recognition	REVENUE RECOGNITION — Revenues from product sales are recognized when the customer obtains control of the product, which typically occurs upon shipment from the Company's facility. There are a very limited number of customers for which control does not pass until they have received the products at their facility. Revenue from product sales is adjusted for estimated warranty obligations and variable consideration, which are detailed below. The amount of revenue recognized is to reflect the consideration expected to be received for those goods or services. Warranties - The Company offers a lifetime warranty to consumers in the United States and certain other countries. This lifetime warranty creates a future performance obligation. The Company determines the standalone selling price for this performance obligation using the cost-plus method. There are also certain foreign distributors that receive warranty repair parts and replacement headphones to satisfy warranty obligations in those countries. The Company defers revenue to recognize the future obligations related to these warranties. The deferred revenue is based on historical analysis of warranty claims relative to sales. This deferred revenue reflects the Company's best estimates of the amount of warranty returns and repairs it will experience during those future periods. If future warranty activity varies from the estimates, the Company will adjust the estimated deferred revenue, which would affect net sales and operating results in the period that such adjustment becomes known. The Company typically receives payment for product at the time of shipment or under normal collection terms, which are generally 30-60 days. The Company estimates that the warranty related performance obligation is satisfied within one to three years and therefore uses that same time frame for recognition of the deferred revenue, using amortization of 50% in year 1, 30% in year 2, and 20% in year 3 for domestic sales. Export deferred revenue, where applicable, is recognized over a 12-month period from date of shipment. Reserves for Variable Consideration - Revenue from product sales is recorded at the net sales price, which includes estimates of variable consideration for which reserves are established and which result from returns, rebates, and co-pay assistance that are offered within contracts between the Company and its customers. Overall, these reserves reflect the Company's best estimates of the amount of consideration to which it is entitled based on the terms of the contract. If actual results in the future vary from the estimates, the Company will adjust these estimates, which would affect net sales and operating results in the period such variances become known. Product Returns - The Company generally offers customers a limited right of return. The Company estimates the amount of product sales that may be returned by its customers and records the estimate as a reduction of revenue in the period the related product revenue is recognized. Product return liabilities are estimated using historical sales and returns information. If actual results in the future vary from the estimates, the Company will adjust these estimates, which would affect net sales and operating results in the period such variances become known. Volume Rebates - The Company offers volume rebates to certain customers in the United States and certain foreign distributors. These volume rebates are tied to sales volume within specified periods. The amount of revenue is reduced for variable consideration related to customer rebates, which are calculated using expected values and is based on program specific factors such as expected rebate percentages and expected volumes. Changes in such accruals may be required if actual sales volume differs from estimated sales volume, which would affect net sales and operating results in the period such variances become known. Seller Fees – The Company pays fees to a major online marketplace for use of its services. Referral fees, the commission paid to the online platform to cover the costs associated with promoting, advertising, and facilitating product sales to its customers, are calculated as a percentage of the sales price and are imposed on sales of all products sold through the marketplace. When orders are fulfilled by the online marketplace, the Company is assessed fulfillment fees to cover the cost of fulfillment of the order as well as the assumption of risk of inventory control, damages and returns. The fees assessed are based on a product’s category, price, size and weight and are deducted from the sales price of each product prior to remittance to the Company with revenue reported on a net basis. Prior to fiscal year 2023, revenue from orders obtained through the online marketplace but fulfilled by the Company direct to the end customer was reported net of referral fees, and related fulfillment costs were recorded in cost of goods sold. Effective with the current year, the referral fees of $43,190 were reported as selling expense and revenue was reported as gross sales. As a result of the accounting change, a reclass was made for fiscal year ending June 30, 2022 to move $98,252 of referral fees from Net Sales to Selling, General and Administrative Expenses to report these sales on a consistent basis. Sales Commissions - The Company has elected the practical expedient of not capitalizing sales commissions.
Research and Development	RESEARCH AND DEVELOPMENT — Research and development is primarily comprised of product prototypes and testing. These activities, charged to operations as a component of selling, general and administrative expenses in the accompanying Consolidated Statements of Income, amounted to $288,231 and $285,244 in 2023 and 2022, respectively.
Advertising Costs	ADVERTISING COSTS — Advertising costs included within selling, general and administrative expenses in the accompanying Consolidated Statements of Income were $65,374 in 2023 and $50,513 in 2022. Such costs are expensed as incurred.
Income Taxes	INCOME TAXES — The Company operates as a C Corporation under the Internal Revenue Code (the “Code"). Amounts provided for income tax expense are based on income reported for financial statement purposes and do not necessarily represent amounts currently payable under tax laws. Deferred income tax assets and liabilities are computed annually for differences between the financial statements and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. As changes in tax laws or rates are enacted, deferred income tax assets and liabilities are adjusted through the provision for income taxes. The differences relate principally to different methods used for depreciation and amortization for income tax purposes, net operating loss carryforwards, capitalization requirements of the Code, allowances for doubtful accounts, provisions for excess and obsolete inventory, stock-based compensation, warranty reserves, and other income tax related carryforwards. A valuation allowance is established when necessary to reduce deferred income tax assets to the amount that is more likely than not to be realized.
Patent Costs	PATENT COSTS — The Company incurs on-going legal fees and filing costs related to the patent portfolio. These costs are expensed in the period they are incurred since no patent legal costs were probable to provide a future economic benefit.
Income per Common and Common Stock Equivalent Share	INCOME PER COMMON AND COMMON STOCK EQUIVALENT SHARE — Income per common and common stock equivalent share is calculated under the provisions of Topic 260 in the Accounting Standards Codification ("ASC") which provides for calculation of “basic” and “diluted” income per share. Basic income per common and common stock equivalent share includes no dilution and is computed by dividing net income by the weighted average common shares outstanding for the period. Diluted income per common and common stock equivalent share reflects the potential dilution of securities that could share in the earnings of an entity. See Note 11 for additional information on income per common and common stock equivalent share.
Cash and Cash Equivalents	CASH AND CASH EQUIVALENTS — The Company considers depository accounts and investments with a maturity at the date of acquisition and expected usage of three months or less to be cash and cash equivalents. The Company maintains its cash on deposit at a commercial bank located in the United States of America. The Company periodically has cash balances in excess of insured amounts. The Company has not experienced, and does not expect to incur, any losses on these deposits.
Accounts Receivable	ACCOUNTS RECEIVABLE — Accounts receivable consist of unsecured trade receivables due from customers. An allowance for doubtful accounts is recorded for significant past due receivable balances based on a review of the past due item and general economic conditions
Investments	INVESTMENTS — Debt securities are classified as held-to-maturity as the Company has the positive intent and ability to hold them to maturity. The securities are carried at amortized cost as current or noncurrent based upon maturity date and unrealized gains and losses are recognized when realized. The amortized cost of debt securities is adjusted for amortization of premium and accretion of discount to maturity. Such amortization or accretion is included in interest income, along with other interest on cash and cash equivalents. See Note 4 for additional information on investments.
Inventories	INVENTORIES — As of June 30, 2023 and 2022, the Company’s inventory was recorded using standard cost which approximates the lower of first in first out (“FIFO”) cost or net realizable value. The carrying value of inventory is reviewed for impairment on at least a quarterly basis, or more frequently if warranted due to changes in market conditions. See Note 5 for additional information on inventory.
Equipment and Leasehold Improvements	EQUIPMENT AND LEASEHOLD IMPROVEMENTS — Equipment and leasehold improvements are stated at cost. Depreciation and amortization are calculated using the straight-line method over the estimated useful lives of the respective assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the asset. Major expenditures for property and equipment and significant renewals are capitalized. Maintenance, repairs and minor renewals are expensed as incurred. When assets are retired or otherwise disposed of, their costs and related accumulated depreciation and amortization are removed from the accounts and any resulting gains or losses are included in operations. See Note 6 for additional information on equipment and leasehold improvements.
Leases	LEASES — The Company determines if a contract is a lease at the date of inception. The Company leases its facility in Milwaukee, Wisconsin from Koss Holdings, LLC, which is controlled by five equal ownership interests in trusts held by the five beneficiaries of the former chairman’s revocable trust and includes current stockholders of the Company. The lease agreement provides the Company the right to substantially all of the economic benefits and direct the use of the building, thus is considered a lease. The agreement does not convey ownership of the building to the lessee at the end of the term of the lease so is accounted for as an operating lease. Operating leases are reported on the Company's Consolidated Balance Sheets as operating lease right-of-use ("ROU") assets and operating lease liabilities. Operating lease ROU assets and liabilities are valued at the present value of the future lease payment obligations. The Company uses a rate based upon current incremental borrowing rates to determine the present value of future lease payments as the rate is not implicit in the lease. Operating lease expense is recorded on a straight-line basis over the life of the lease taking into account expected renewal periods.
Life Insurance Policies	LIFE INSURANCE POLICIES — Life insurance policies are stated at cash surrender value or at the amount the Company would receive in the case of split-dollar arrangements. Increases in cash surrender value, net of annual premiums paid, and the proceeds from company-owned life insurance policies are included in selling, general and administrative expenses and other income, respectively, in the Consolidated Statements of Income.
Deferred Compensation	DEFERRED COMPENSATION —At June 30, 2023 and 2022, the Company’s deferred compensation liability is for a current officer and is calculated based on years of service and compensation, along with various assumptions related to expected retirement date, discount rates, and mortality tables. The related expense is calculated using the net present value of the expected payments and is included in selling, general and administrative expenses in the Consolidated Statements of Income. The selling, general and administrative expenses recorded during the year end June 30, 2022, also include the gain recorded as a result of the reversal of the deferred compensation current and noncurrent liabilities recorded for the Company’s founder who passed away on December 21, 2021. See Note 10 for additional information on deferred compensation.
Fair Value of Financial Instruments	FAIR VALUE OF FINANCIAL INSTRUMENTS — Cash equivalents, accounts receivable, and accounts payable approximate fair value based on the short maturity of these instruments. The Company’s investments are classified as held-to-maturity and reported at amortized cost on the Consolidated Balance Sheets. The fair value is based upon quoted market prices and is disclosed in Note 4.
Impairment of Long-Lived Assets	IMPAIRMENT OF LONG-LIVED ASSETS — The Company evaluates the recoverability of the carrying amount of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be fully recoverable. If an asset is considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell. Management determines fair value using an undiscounted future cash flow analysis or other accepted valuation techniques. No impairments of the Company's long-lived assets were recorded in the years ended June 30, 2023 or 2022.
Legal Costs	LEGAL COSTS — All legal costs related to litigation, for which the Company is liable, are charged to operations as incurred, except contingent legal fees as described below. Proceeds from the settlement of legal disputes are recorded in other income when the amounts are determinable, and the collection is certain. License proceeds are considered functional and as such are recorded at a point in time, based on the underlying agreement. Related contingent legal fees and expenses are recorded in selling, general and administrative expense at that time. Changes to the contingent legal fee expenses would cause a material impact to the results of operations.
Stock-Based Compensation	STOCK-BASED COMPENSATION — The Company has a stock-based employee compensation plan, which is described more fully in Note 12. The Company accounts for stock-based compensation in accordance with ASC 718 "Compensation - Stock Compensation". Under the fair value recognition provisions of this statement, share-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the vesting period.
Other Income	OTHER INCOME — The Company maintains a program focused on enforcing its intellectual property and, in particular, certain of its patent portfolio, by filing complaints against certain parties alleging infringement on the Company’s patents relating to its wireless headphone technology. The Company has granted license agreements related to certain patents allowing the Company to recover certain of the fees and costs that were involved with the underlying efforts to enforce this portfolio. In the years ended June 30, 2023 and 2022, the Company received licensing proceeds of $33,000,000 and $100,000, respectively, which were recorded as other income. In the year ended June 30, 2022, the Company also recognized approximately $262,000 of other income related to the proceeds from company-owned life insurance policies on its founder, who passed away on December 21, 2021.
Use of Estimates	USE OF ESTIMATES — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenue and expenses during the reported periods. Actual results could differ from those estimates.
Recent Accounting Pronouncements	RECENT ACCOUNTING PRONOUNCEMENTS In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The standard’s main goal is to improve financial reporting by requiring earlier recognition of credit losses on financing receivables and other financial assets, including accounts and notes receivables. The new guidance represents significant changes to accounting for credit losses. The current incurred loss impairment model that recognizes losses when a probable threshold is met will be replaced with the expected credit loss impairment method without recognition threshold. The expected credit losses estimate will be based upon historical information, current conditions, and reasonable and supportable forecasts. On November 15, 2019, the FASB delayed the effective date of FASB ASC Topic 326 for certain smaller public companies and other private companies. As amended, the effective date of ASC Topic 326 was delayed until fiscal years beginning after December 15, 2022 for SEC filers that are eligible to be smaller reporting companies under the SEC’s definition. As such, ASC Topic 326 will be effective for the Company for the fiscal year ending June 30, 2024. Management is currently assessing the impact of the adoption of this standard on the Company’s financial statements.

Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Jun. 30, 2023	Aug. 21, 2023	Dec. 31, 2022
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Jun. 30, 2023
Document Fiscal Year Focus	2023
Current Fiscal Year End Date	--06-30
Document Transition Report	false
Entity File Number	0-3295
Entity Registrant Name	KOSS CORPORATION
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	4129 North Port Washington Avenue
Entity Address, City or Town	Milwaukee
Entity Address, State or Province	WI
Entity Tax Identification Number	39-1168275
Entity Address, Postal Zip Code	53212
City Area Code	414
Local Phone Number	964-5000
Title of 12(b) Security	Common Stock, $0.005 par value per share
Trading Symbol	KOSS
Security Exchange Name	NASDAQ
Entity Well Known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	false
Entity Shell Company	false
Entity Public Float			$ 24,849,955
Entity Common Stock, Shares Outstanding		9,234,795
Documents Incorporated by Reference [Text Block]	Part III of this Form 10-K incorporates by reference certain information from Koss Corporation’s Proxy Statement for its 2023 Annual Meeting of Stockholders to be filed with the Commission under Regulation 14A within 120 days of the end of the fiscal year covered by this Form 10-K.
Document Fiscal Period Focus	FY
Entity Central Index Key	0000056701
Amendment Flag	false
Auditor Name	Wipfli LLP
Auditor Location	Milwaukee, Wisconsin
Auditor Firm ID	344

Consolidated Balance Sheets (Parentheticals) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Consolidated Balance Sheets [Abstract]
Accounts receivable, allowance for doubtful accounts	$ 6,027	$ 2,027
Common stock, par value (in dollars per share)	$ 0.005	$ 0.005
Common stock, shares authorized (in shares)	20,000,000	20,000,000
Common stock, shares issued (in shares)	9,234,795	9,147,795
Common stock, shares outstanding (in shares)	9,234,795	9,147,795

Stock Options (Tables)

12 Months Ended

Jun. 30, 2023

Stock Options [Abstract]

Stock Option Activity


							Aggregate
						Weighted	Intrinsic
				Weighted		Average	Value of
		Stock		Average		Remaining	In-The-
	Number of	Options		Exercise		Contractual	Money
	Shares	Price Range		Price		Life - Years	Options
Shares under option at June 30, 2021	1,748,000	$	1.73 - $6.00	$	2.29	4.86	$	36,594,280
Granted	—	$	—	$	—
Exercised	(539,089)	$	1.73 - $6.00	$	2.58
Expired	—	$	—	$	—
Forfeited	(150,000)	$	1.73 - $2.65	$	2.00
Shares under option at June 30, 2022	1,058,911	$	1.73 - $2.92	$	2.18	3.72	$	5,055,797
Granted	—	$	—	$	—
Exercised	(87,000)	$	1.73 - $2.65	$	1.97
Expired	—	$	—	$	—
Forfeited	(51,000)	$	1.73 - $2.65	$	1.92
Shares under option at June 30, 2023	920,911	$	1.73 - $2.92	$	2.21	2.21	$	1,373,117
Exercisable as of June 30, 2022	264,577	$	1.73 - $2.92	$	2.45	2.06	$	1,180,591
Exercisable as of June 30, 2023	532,245	$	1.73 - $2.92	$	2.38	1.30	$	700,947

Intrinsic Value


	2023		2022
Total intrinsic value of stock options exercised	$	371,714	$	9,032,778
Cash received from stock option exercises	$	171,350	$	1,390,346
Total fair value of stock options vested	$	448,476	$	620,018
Total recognized tax benefit	$	77,328	$	1,778,981

Nonvested Option Activity


			Weighted
			Average
			Grant Date
	Shares		Fair Value
Non-vested as of June 30, 2021	1,460,000	$	1.23
Granted	—		—
Vested	(515,666)		1.20
Forfeited	(150,000)		1.38
Non-vested as of June 30, 2022	794,334		1.22
Granted	—		—
Vested	(354,668)		1.26
Forfeited	(51,000)		1.34
Non-vested as of June 30, 2023	388,666	$	1.17

Credit Facility (Narrative) (Details) - USD ($)	12 Months Ended
Credit Facility (Narrative) (Details) - USD ($)	Jun. 30, 2023	Jun. 30, 2022
Line of Credit Facility [Line Items]
Interest expense	$ 0	$ 0
Town Bank [Member] \| Credit Agreement [Member] \| Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 5,000,000
Unused line fees	0.00%
Outstanding borrowings	$ 0	$ 0
Town Bank [Member] \| Amended Credit Agreement [Member] \| Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 1,000,000
Town Bank [Member] \| Amended Credit Agreement [Member] \| Revolving Credit Facility [Member] \| Prime Rate [Member]
Line of Credit Facility [Line Items]
Spread on variable interest rate	1.50%

Stock Options (Stock Option Activity) (Details) - USD ($)	12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2021
Stock Options [Abstract]
Shares under option, number of shares (in shares)	1,058,911	1,748,000
Exercised, number of shares (in shares)	(87,000)	(539,089)
Forfeited, number of shares (in shares)	(51,000)	(150,000)
Shares under option, number of shares (in shares)	920,911	1,058,911	1,748,000
Exercisable, number of shares (in shares)	532,245	264,577
Shares under option, stock options price range, lower limit (in dollars per share)	$ 1.73	$ 1.73
Shares under option, stock options price range, upper limit (in dollars per share)	2.92	6.00
Exercised, stock options price range, lower limit (in dollars per share)	1.73	1.73
Exercised, stock options price range, upper limit (in dollars per share)	2.65	6.00
Forfeited, stock options price range, lower limit (in dollars per share)	1.73	1.73
Forfeited, stock options price range, upper limit (in dollars per share)	2.65	2.65
Shares under option, stock options price range, lower limit (in dollars per share)	1.73	1.73	$ 1.73
Shares under option, stock options price range, upper limit (in dollars per share)	2.92	2.92	6.00
Exercisable, stock options price range, lower limit (in dollars per share)	1.73	1.73
Exercisable, stock options price range, upper limit (in dollars per share)	2.92	2.92
Shares under option, weighted average exercise price (in dollars per share)	2.18	2.29
Exercised, weighted average exercise price (in dollars per share)	1.97	2.58
Forfeited, weighted average exercise price (in dollars per share)	1.92	2.00
Shares under option, weighted average exercise price (in dollars per share)	2.21	2.18	$ 2.29
Exercisable, weighted average exercise price (in dollars per share)	$ 2.38	$ 2.45
Shares under option, weighted average remaining contractual life (Year)	2 years 2 months 15 days	3 years 8 months 19 days	4 years 10 months 9 days
Exercisable, weighted average remaining contractual life (Year)	1 year 3 months 18 days	2 years 21 days
Shares under option, aggregate intrinsic value of in-the-money options	$ 1,373,117	$ 5,055,797	$ 36,594,280
Exercisable, aggregate intrinsic value of in-the-money options	$ 700,947	$ 1,180,591

Income per Common and Common Stock Equivalent Share

12 Months Ended

Jun. 30, 2023

Income per Common and Common Stock Equivalent Share [Abstract]

Income per Common and Common Stock Equivalent Share

11. INCOME PER COMMON AND COMMON STOCK EQUIVALENT SHARE

Basic income per share is computed based on the weighted-average number of common shares outstanding. Diluted income per common share is calculated assuming the exercise of stock options except where the result would be anti-dilutive. The following table reconciles the numerator and denominator used to calculate basic and diluted income per share:


		Year Ended
	2023		2022
Numerator
Net income	$	8,302,380	$	1,268,409

Denominator
Weighted average shares, basic		9,192,799		9,070,277
Dilutive effect of stock compensation awards (1)		560,961		915,385
Diluted shares		9,753,760		9,985,662

Net income attributable to common shareholders per share:
Basic	$	0.90	$	0.14
Diluted	$	0.85	$	0.13

(1) No exercised stock options were anti-dilutive for the years ended June 20, 2023 and 2022.