Company: AGSS
Filing Date: 2025-05-12
Form Type: 10-K
Source: 0001829126-25-003553
Chunk: 616

Company: AMERIGUARD SECURITY SERVICES, INC.
Filing Date: 2025-05-12
Form: 10-K
Item: Item 9B
Chunk 616
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an appropriate allowance for estimated uncollectible accounts to reflect any loss anticipated on the accounts receivable balances and
is charged to bad debt expense. We calculate this allowance based on our history of write-offs, the level of past-due accounts based on
the contractual terms of the receivables, and our relationships with, and the economic status of, our customers. With over eighty-nine
percent of year end accounts receivable balance from Federal contracts that require payment, and the uncollectable amount historically
has been less than 1%. As of December 31, 2024, and 2023, an allowance for estimated uncollectible accounts was determined to be
unnecessary.

Property and Equipment

Property and equipment are recorded at cost.
Expenditures for major additions and improvements are capitalized, and minor replacements, maintenance, and repairs are charged to
expense as incurred. When property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are
removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period.
Depreciation is provided over the estimated useful lives of the related assets using the straight-line method for financial
statement purposes. The Company uses other depreciation methods (generally accelerated) for tax purposes where appropriate. The
estimated useful life for Machinery and Equipment, and Vehicles is 5 years, Leased vehicles based on lease term, with Leasehold
improvements useful life is 15
Years.

Operating Leases

In February 2016, FASB ASU No. 2016-02 established ASC Topic 842, Leases, which sets out the principles for recognition, measurement, presentation, and disclosure of leases for both lessees and lessors. Effective December 31, 2022, we have implemented ASU No. 2016-02 and booked the operating lease asset and the related liability.

The Company is a lessee with Enterprise Lease
Management for vehicles used in operations, under an all-inclusive master lease. The Company determines if an arrangement is a lease,
or contains a lease, at inception of a contract and when the terms of an existing contract are changed. The Company recognizes a lease
liability and a right-of-use (ROU) asset at the commencement date. The lease liability is initially and subsequently recognized based
on the present value of its future lease payments. Variable payments are included in the future lease payments when those variable payments
depend on an index or a rate. The discount