Company: NCEL
Filing Date: 2025-05-16
Form Type: 20-F
Source: 0001213900-25-044868
Chunk: 357

Company: NewcelX Ltd.
Filing Date: 2025-05-16
Form: 20-F
Item: Item 19
Chunk 357
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 on the difference between the consolidated financial statement and tax basis of assets and liabilities using enacted
tax rates in effect in the years in which the differences are expected to reverse. Changes in deferred tax assets and liabilities are
recorded in the provision for income taxes. The Company assesses the likelihood that its deferred tax assets will be recovered from future
taxable income and, to the extent it believes, based upon the weight of available evidence, that it is more likely than not that all or
a portion of the deferred tax assets will not be realized, a valuation allowance is established through a charge to income tax expense.
Potential for recovery of deferred tax assets is evaluated by estimating the future taxable profits expected and considering prudent and
feasible tax planning strategies.

Due to the fact that the Company has a history
of generating losses, and expects to generate losses in the foreseeable future, a full valuation allowance has been recorded.

The Company accounts for uncertain tax positions
in accordance with an amendment to ASC Topic 740-10, “ Income Taxes(Accounting for Uncertainty in Income Taxes),”which clarified the accounting for uncertainty in tax positions. This amendment provides that the tax effects from an uncertain tax
position can be recognized in the consolidated financial statements only if the position is “more-likely-than-not” to be sustained
were it to be challenged by a taxing authority. The assessment of the tax position is based solely on the technical merits of the position,
without regard to the likelihood that the tax position may be challenged. If an uncertain tax position meets the “more-likely-than-not”
threshold, the largest amount of tax benefit that is more than50% likely to be recognized upon ultimate settlement with the taxing authority
is recorded.

Employee Benefits (including Post Retirement Benefits)

The Company operates the mandatory pension plan
for its employees in Switzerland. The plan is generally funded through payments to insurance companies or trustee-administered funds.
The Company has a pension plan designed to pay pensions based on accumulated contributions on individual savings accounts. However, this
plan is classified as a defined benefit plan under ASC 960“ Plan Accounting - Defined Benefit Pension Plans.”

The net defined benefit liability is the present
value of the defined benefit obligation at the balance sheet date minus the fair value of plan assets. The defined benefit obligation
is calculated annually by independent actuaries using the projected unit credit method, which reflects services rendered by employees
to the date of valuation, incorporates assumptions concerning employees’ projected salaries, pension increases as well as discount
rates of highly liquid corporate bonds