Company: BTBT
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110383
Chunk: 29

Company: Bit Digital, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 1
Chunk 29
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 that the fair value of a reporting unit is less than its carrying amount. If
the qualitative assessment is not performed, or after assessing the totality of the events or circumstances, we determine it is more
likely than not that the fair value of a reporting unit is less than its carrying amount, a quantitative assessment for potential impairment
is performed.

The
quantitative goodwill impairment test is performed by comparing the fair value of the reporting unit with its carrying amount, including
goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not impaired. An impairment loss is recognized
for any excess of the carrying amount of the reporting unit over its fair value up to the amount of goodwill allocated to the reporting
unit.

12

Finite-lived
intangible Assets 

Intangible
assets are recorded at cost less any accumulated amortization and any accumulated impairment losses. Intangible assets acquired through
business combinations are measured at fair value at the acquisition date.

Intangible
assets with finite lives are comprised of customer relationships and are amortized on straight-line basis over their estimated useful
lives. The Company assesses the appropriateness of finite-lived classification at least annually. Additionally, the carrying value and
remaining useful lives of finite-lived assets are reviewed annually to identify any circumstances that may indicate potential impairment
or the need for a revision to the amortization period. A finite-lived intangible asset is considered to be impaired if its carrying value
exceeds the estimated future undiscounted cash flows expected to be generated from it. We apply judgment in selecting the assumptions
used in the estimated future undiscounted cash flow analysis. Impairment is measured by the amount that the carrying value exceeds fair
value. The useful lives of customer relationships is 19 years.

Business
combinations

The
Company accounts for business combinations under the acquisition method of accounting in accordance with ASC 805 - Business Combinations,
by recognizing the identifiable tangible and intangible assets acquired and liabilities assumed, measured at the acquisition date fair
value. The determination of fair value involves assumptions, estimates, and judgments. The initial allocation of the purchase price is
considered preliminary and therefore subject to change until the end of the measurement period (up to one year from the acquisition date).
Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net assets acquired.

Acquisition-related
expenses are recognized separately from the business combination and are expensed as incurred.

Investment
securities

As
of September