Company: NOTV
Filing Date: 2025-02-06
Form Type: 10-Q
Source: 0001628280-25-004178
Chunk: 105

Company: Inotiv, Inc.
Filing Date: 2025-02-06
Form: 10-Q
Item: Part II, Item 8
Chunk 105
---
ASB issued ASU 2023-09, “Improvements to Income Tax Disclosures (Topic 740)”. ASU 2023-09 requires enhanced disclosures on income taxes paid, adds disaggregation of continuing operations before income taxes between foreign and domestic earnings and defines specific categories for the reconciliation of jurisdictional tax rate to effective tax rate. This ASU is effective for fiscal years beginning after December 15, 2024, and can be applied on a prospective basis. The Company is currently evaluating the impact this new standard will have on the related disclosures in the consolidated financial statements.

Concentration of RiskFinancial instruments that potentially subject the Company to concentrations of credit risk consist primarily of trade receivables from clients in the biopharmaceutical, contract research, academic, and governmental sectors. The Company believes its exposure to credit risk is minimal, as the majority of the clients are predominantly well established and viable. Additionally, the Company maintains allowances for potential credit losses. The Company’s exposure to credit loss in the event that payment is not received for revenue recognized equals the outstanding trade receivables and contract assets less fees invoiced in advance.

During the three months ended December 31, 2024 and December 31, 2023, one client accounted for 20.5% and 22.4% of revenue, respectively. During the three months ended December 31, 2024 and December 31, 2023, no vendors accounted for more than 10% of the sum of cost of services and cost of products. 

2.    REVENUE FROM CONTRACTS WITH CLIENTSDSAThe DSA segment generates service revenue through drug discovery and development services. The DSA segment generates product revenue through internally-manufactured scientific instruments for life sciences research and the related software for use by pharmaceutical companies, universities, government research centers and medical research institutions under the Company’s BASi product line. Refer to Note 1 – Description of the Business and Basis of Presentation for further discussion of types of services and products offered within the DSA segment.RMSThe RMS segment generates product revenue through the commercial production, procurement and sale of research models, diet, bedding and enrichment products and bioproducts. The RMS segment generates service revenue through Genetically Engineered Models and Services ("GEMS"), client-owned animal colony care, and health monitoring and diagnostics services related to research models. Refer to Note 1 – Description of the Business and Basis of Presentation for further discussion of types of services and products offered within the