Company: GAME
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004869
Chunk: 43

Company: GameSquare Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1
Chunk 43
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 net or gross basis based on the criteria as disclosed below.

Under
national advertising agreements wherein the Company does not bear inventory risk and only has credit risk on its portion of the revenue,
national advertising revenues are accounted for on a net basis and the publisher is identified as the customer. In select national advertising
agreements with its publishers, the Company takes on inventory risk and additional credit risk. Under these agreements, the Company either
a) provides the publisher with a guaranteed minimum gross selling price per advertising unit delivered, wherein the greater of the actual
selling price or guaranteed minimum selling price is used in determining the publisher’s share or b) provides the publisher with
a fixed rate per advertising unit delivered, wherein the publisher is paid the fixed rate per advertising unit delivered irrespective
of the actual selling price. Under these national advertising agreements, national advertising revenues are accounted for on a gross
basis with the advertiser identified as the customer and the publisher identified as a supplier, with amounts billed to the advertiser
reported as revenue and amounts due to the publisher reported as a revenue sharing expense, within expenses.

26

Also
included in advertising revenue is advertising revenue generated by the Company’s various owned and operated properties.

The
Company assesses its revenue arrangements against specific criteria in order to determine if it is acting as principal or agent. When
the Company acts in the capacity of an agent rather than as the principal in a transaction, the revenue recognized is the net amount
of commission made by the Company.

Deferred
revenue consists of customer advances for Company services to be rendered that will be recognized as income in future periods.

Income
taxes

Income
tax on the profit or loss for the periods presented comprises current and deferred tax. Income tax is recognized in profit or loss except
to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current
tax expense is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at year
end, adjusted for amendments to tax payable with regards to previous years.

Deferred
tax is provided using the liability method, providing for temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for the following temporary
differences: the initial recognition of goodwill; the initial recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit; and differences relating to investments in subsidiaries, associates,
and