Company: OKMN
Filing Date: 2025-05-16
Form Type: 10-Q
Source: 0001079973-25-000885
Chunk: 4

Company: OKMIN RESOURCES, INC.
Filing Date: 2025-05-16
Form: 10-Q
Item: Part I, Item 1
Chunk 4
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 are based on reliable available inputs of observable data.
The hierarchy requires the use of observable market data when available.

ASC 820 requires
that assets and liabilities measured at fair value are classified and disclosed in one of the following three categories:

Level 1 -

Level 2 -

Level 3 -

Financial instruments consist principally of cash
and cash equivalents, accounts receivable, prepaid expenses, oil and gas properties, accounts payable, accrued liabilities, note payable,
and interest payable. The recorded values of all financial instruments approximate their current fair values because of their nature and
respective relatively short maturity dates or durations.

Fair value estimates are made at a specific point
in time, based on relevant market information and information about the financial statement. These estimates are subjective in nature
and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions
could significantly affect the estimates.

Revenue recognition

The Company is not the operator of any of its oil
and gas properties. Sales of all oil and gas produced are the responsibility of the property operator. The operator recognizes revenue
when production is sold at a fixed or determinable price, persuasive evidence of an arrangement exists, delivery has occurred, title has
transferred, and collectability is reasonably assured in accordance with ASC 606. The Company only recognizes oil and gas revenues when
the operator has provided the Company with confirmation of the completed sale and the amount of the revenue attributable to the Company’s
working interest has been determined.

Stock-based compensation

The Company accounts for stock-based compensation
in accordance with ASC 718, “ Compensation - Stock Compensation” (“ ASC 718”). Stock-based compensation is recognized
as compensation expense in the financial statements based on the fair value which is measured on the grant date for stock-settled awards.
That expense is recognized over the period during which a grantee is required to provide services in exchange for the award. Stock-based
compensation expense recognized during the period is based on the value of the portion of share-based payment awards that is ultimately
expected to vest during the period, or in the period of grant for awards that vest immediately without any future service condition. For
awards that vest over time, previously recognized compensation cost is reversed if the service or performance conditions are not satisfied
and the award is forfeited.

Income taxes

Income taxes are accounted for under the asset and
liability method in accordance with ASC 740, “ Income Taxes”. Deferred tax assets and liabilities are recognized for future
tax consequences attributable to differences between