Company: DGLY
Filing Date: 2025-05-02
Form Type: 424B3
Source: 0001641172-25-008437
Chunk: 95

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-02
Form: 424B3
Chunk 95
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As disclosed in Note 21, on March 1, 2024, the Company completed an acquisition referred to as the Country Stampede Acquisition in accordance with the asset purchase agreement. The consideration included payment of cash of $542,959 of which $400,000 was paid on March 1, 2024 and remainder on or before thirty days. Auditing the accounting for the acquisition was complex due to the significant estimation uncertainty in determining the fair values of identified intangible assets, which consisted of trademarks and trade names of $300,000 and Goodwill of $225,959.

The principal considerations for our determination that performing procedures relating to the intangible assets acquired with the Country Stampede Acquisition is a critical audit matter because (i) the significant judgment used by management when determining the fair value estimates of the intangible assets acquired; (ii) the high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating the significant assumptions used in management’s fair value estimates; and (iii) the audit effort involved in the use of professionals with specialized skill and knowledge.

How the Critical Audit Matter Was Addressed in the Audit

| ● | We utilized                                                                                                                             
 personnel with specialized knowledge and skill in valuation to assist in: a) assessing the appropriateness of valuation methodology     
 for the trademarks and trade names using Relief from Royalty, b) evaluating the reasonableness of the growth rates, percent of revenues 
 lost without existing agreements, discount rate used in the income approach.                                                            |
| ● | Evaluate the reasonableness                                                                                                             
 of management’s significant estimates and assumptions including revenue growth rates, percent of revenues lost without existing         
 agreements and discount rate in the valuation of the trademarks and trade names.                                                        |
| ● | Evaluate if there have                                                                                                                  
 been events and circumstances that might indicate that intangible asset and goodwill has been impaired.                                 |

/s/ RBSM LLP

We have served as the Company’s auditor since 2019.

New York, NY

May 2, 2025

PCAOB ID Number 587

<div align='center'>New York, NY Washington DC Mumbai & Pune, India Boca Raton, FL

Houston, TX San Francisco, CA Las Vegas, NV Beijing, China Athens, Greece

Member: ANTEA International with affiliated offices worldwide</div>

| F-3 |

<div align='center'>DIGITAL ALLY, INC.

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2024 AND 2023</