Company: GURE
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001193805-25-001627
Chunk: 21

Company: GULF RESOURCES, INC.
Filing Date: 2025-11-19
Form: 10-Q
Item: Item 1
Chunk 21
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not that some portion or all of a deferred tax asset will not be realized, a valuation allowance is recognized. The guidance also provides
criteria for the recognition, measurement, presentation and disclosures of uncertain tax positions. A tax benefit from an uncertain tax
position may be recognized if it is “more likely than not” that the position is sustainable based solely on its technical
merits. Interests and penalties associated with unrecognized tax benefits are included within the (benefit from) provision for income
tax in the consolidated statement of income (loss).

(t)        New
Accounting Pronouncements

Recent accounting pronouncements adopted

There were no recent accounting pronouncements adopted during the nine
months ended September 30, 2025.

Recently Issued Accounting Pronouncements Not
Yet Adopted

There were no recently issued accounting pronouncements not yet adopted
during the nine months ended September 30, 2025.

(u)      Fair Value Measurement

The Company applies Accounting Standards Codification
(“ASC”) Topic 820, Fair Value Measurements and Disclosures which defines fair value, establishes a framework for measuring
fair value and expands financial statement disclosure requirements for fair value measurements.

ASC Topic 820 defines fair value as the price
that would be received from the sale of an asset or paid to transfer a liability (an exit price) on the measurement date in an orderly
transaction between market participants in the principal or most advantageous market for the asset or liability.

ASC Topic 820 specifies a hierarchy of valuation
techniques, which is based on whether the inputs into the valuation technique are observable or unobservable. The hierarchy is as follows:

Level 1 inputs to the valuation methodology are
quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 inputs to the valuation methodology include
quoted prices for identical or similar assets and liabilities in active markets or in inactive markets, and inputs that are observable
for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.

Level 3 inputs to the valuation methodology are
unobservable and significant to the fair value.

The carrying amounts of the Company’s financial
instruments approximate their fair values because of their short-term nature. The Company’s financial instruments include cash,
accounts receivable, amounts due to related parties, accounts payable and other current payables. There were no material unrecognized
financial assets and liabilities as of September 30, 2025 and 2024.

The Company determines the fair value with