Company: APCXW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001683168-25-006148
Chunk: 25

Company: AppTech Payments Corp.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 25
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 operations are based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The
preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of
assets, liabilities, revenues and expenses. Significant estimates include those related to the valuation of goodwill impairment and intangible
assets, and equity-based compensation. These estimates are based on historical experience and assumptions believed to be reasonable under
current conditions. It’s important to note that actual results could differ from these estimates.

Critical accounting policies are those that we consider
the most critical to understanding our financial condition and results of operations. The accounting policies we believe to be most critical
to understanding our financial condition and results of operations are discussed below. As of June 30, 2025, there have been no significant
changes to our critical accounting estimates nor to our recently issued accounting pronouncements, except as described in Note 2 to our
consolidated financial statements.

Equity-Based Compensation: We estimate the
fair value of stock options granted using the Black-Scholes option pricing model, which requires input of subjective assumptions. The
model inputs include expected stock price volatility, expected term, risk-free interest rate, and dividend yield. The assumptions about
future stock price volatility and the option’s expected term involve significant judgments based on historical data and future expectations.
The reported equity-based compensation expense is sensitive to changes in the volatility assumption. An increase in expected volatility
could materially impact the amount of compensation expense recognized.

Goodwill Impairment 

Goodwill Impairment Testing: The process requires
an annual test for impairment of goodwill, and more frequent testing if certain indicators suggest that the goodwill might be impaired.
This assessment involves comparing the carrying amount of a reporting unit, including goodwill, to its fair value. Key estimates in determining
fair value include: a) Cash Flow Projections: Utilizing the DCF method, management estimates future cash flows based on current performance,
business plans, and expected market growth, introducing judgment due to forecasting uncertainties. b) Discount Rate: The discount rate,
reflecting the WACC and adjusted for unit-specific risks, is crucial for present value calculations, with changes significantly affecting
fair value estimations; c) Long-term Growth Rates: Assumptions on sustainable growth rates impact the terminal value in the DCF model,
thus influencing the overall fair value of the reporting unit.

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Impairment Loss Calculation: The impairment
loss, representing the excess of the carrying amount of goodwill over