Company: OSRH
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076461
Chunk: 17

Company: OSR Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 17
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 product to a customer, meaning the customer has the ability to direct the use and obtain the benefit
of the good or product.

n.Income taxes

Income taxes are accounted for under
the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss
and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income
in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities
of a change in tax rates is recognized in income in the period that includes the enactment date. The Group recognizes the effect of income
tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the
largest amount that is greater than 50% likely of being realized. Valuation allowances are established when management determines it
is more likely than not that some portion, or all, of the deferred tax assets will not be realized. Changes in recognition or measurement
are reflected in the period in which the change in judgment occurs. The Group reports income tax-related interest and penalties
relating to uncertain tax positions, if applicable, as a component of income tax expense.

o.Fair value measurements

The Group utilizes valuation techniques
that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Group determines fair
value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous
market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes
between observable and unobservable inputs, which are categorized in one of the following levels:

–Level
                                            1 inputs: Unadjusted quoted prices in active markets for identical assets or liabilities
                                            accessible to the reporting entity at the measurement date.

–Level
                                            2 inputs: Other than quoted prices included in Level 1 inputs that are observable for the
                                            asset or liability, either directly or indirectly, for substantially the full term of the
                                            asset or liability.

–Level
                                            3 inputs: Unobservable inputs for the asset or liability used to measure fair value to the
                                            extent that observable inputs are not available, thereby allowing for situations in which
                                            there is little, if any, market activity for the asset or liability at measurement date.

The carrying