Company: EMCRF
Filing Date: 2025-05-20
Form Type: 10-Q
Source: 0001829126-25-003812
Chunk: 55

Company: Embrace Change Acquisition Corp.
Filing Date: 2025-05-20
Form: 10-Q
Item: Part I, Item 8
Chunk 55
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 2025 and December 31, 2024.

Cash
                                                                                                                                                                                 and Investments Held in Trust Account

As of March 31, 2025 and December 31, 2024, substantially all of the assets held in the Trust Account were held in U.S. Treasury
Bills. All of the Company’s investments held in the Trust Account are classified as trading securities. Trading securities are presented
on the balance sheet at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of investments
held in Trust Account are included in investment income earned on investments held in Trust in the accompanying statements of operations.
The estimated fair values of investments held in Trust Account are determined using available market information. As of March 31,
2025 and December 31, 2024, the estimated fair values of investments held in Trust Account was $26,354,572
and $26,087,209,
respectively.

    10

Fair Value of Financial Instruments

The fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820,
         “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented
         in the accompanying balance sheets, primarily due to their short-term nature.

The Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers include:

    ●
    Level 1, defined as observable inputs such as quoted prices (unadjusted) for identical instruments in active markets; 

    ●
    Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and 

    ●
    Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. 

In some circumstances, the inputs used to measure fair value might be categorized