Company: GCL
Filing Date: 2025-04-08
Form Type: 424B3
Source: 0001213900-25-029989
Chunk: 178

Company: GCL Global Holdings Ltd
Filing Date: 2025-04-08
Form: 424B3
Chunk 178
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 that the following critical accounting policies involve the most significant estimates and judgments used in the preparation of our financial statements.

| ● | Allowance       
 for credit loss |

| ● | Inventories 
 write-down  |

| ● | Indefinite-life             
 intangible asset impairment |

| ● | Deferred     
 income taxes |

| ● | Contingent                     
 consideration for acquisitions |

| ● | Goodwill   
 impairment |

<div align='center'>105</div>

Use of Estimates and Assumptions

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in our consolidated financial statements include estimates of allowances for credit loss and doubtful accounts, estimate of inventory write-down, estimates of impairment of indefinite-lived intangible assets and goodwill, valuation allowance of deferred tax assets, contingent consideration for acquisitions, and other provisions and contingencies. Actual results could differ from these estimates.

Allowance for credit loss and doubtful account

We adopted ASU No.2016-13 “Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASC Topic 326”) on our accounts receivable and other receivables and other current asset using the modified retrospective approach, starting from April 1, 2021. The new credit loss guidance replaces the old model for measuring the allowance for credit losses with a model that is based on the expected losses rather than incurred losses. Under the new accounting guidance, we measure credit losses on accounts receivable and other receivables using the current expected credit loss model under ASC 326. As of September 30, 2024 and March 31, 2024, the Company provided allowance for credit loss of approximately $0.4 million and $0.4 million, respectively. For any prepayments determined by management that such advances will not be in receipts of inventories, services, or refundable. We recognize an allowance for doubtful account to reserve such balances. As of September 30, 2024 and March 31, 2024, the Company provided allowance related to prepayment of approximately $20,000 and $0.2 million, respectively.

Inventories write-down

Inventories mainly include physical console game compact disc, gaming hardware and accessories which are purchased from our suppliers as merchandized goods