Company: CNTB
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001835268-25-000014
Chunk: 261

Company: Connect Biopharma Holdings Ltd
Filing Date: 2025-03-31
Form: 10-K
Item: Item 8
Chunk 261
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 the credits or funds. Government grants received in advance of costs being incurred are deferred until the associated costs are recognized. Payments received are recognized as other income in the statements of operations and comprehensive loss over the period in which the Company recognizes the related costs. For the years ended December 31, 2024 and 2023, the Company received government grants of $2.6 million and $1.5 million, respectively, primarily related to incentives to support research and development activities.Income TaxesIncome taxes are provided for in accordance with the laws of the relevant tax authorities. Deferred tax assets and liabilities are recognized when temporary differences exist between the tax basis of assets and liabilities and their reported amounts in the consolidated financial statements. Net operating loss carryforwards and credits are applied using enacted statutory tax rates applicable to future years. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more-likely-than-not that a portion of or all of the deferred tax assets will not be realized. The total amount of unrecognized tax benefits, if recognized, would affect other tax accounts, primarily deferred taxes in future periods, and would not affect our effective tax rate, since we maintain a full valuation allowance against our deferred tax assets (see Note 11). We recognize interest and penalties related to income tax matters in income tax expense.Segment ReportingThe Company operates as one reportable segment. The Company’s Chief Operating Decision-Maker (“CODM”), its Chief Executive Officer, manages the Company’s operations on a consolidated basis for purposes of allocating resources and assessing performance (see Note 12).Comprehensive LossComprehensive loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Net changes in foreign currency translation adjustments and unrealized gains and 

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losses on available-for-sale securities are included in other comprehensive loss and represent the difference between our net loss and comprehensive loss for both periods presented.Net Loss per ShareBasic net loss per share is calculated by dividing the net loss by the weighted-average number of ordinary shares outstanding for the period. Diluted net loss per share is computed by dividing the net loss by the weighted-average number of ordinary shares and ordinary share equivalents outstanding for the period determined using the treasury share method. For purposes of this calculation, stock options and employee share purchase rights are considered to be ordinary share equivalents and are included in the calculation of diluted net loss per share only when their effect is dilutive.Because we have incurred a net loss for both periods presented in the