Company: VPLM
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010694
Chunk: 13

Company: Voip-pal.com Inc
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 1
Chunk 13
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. Diluted income per share includes potentially dilutive securities such as stock
options and share purchase warrants outstanding during each period. To calculate diluted loss per share the Company uses the treasury
stock method and the if-converted method.

For the period ended March 31, 2025 and the year ended
September 30, 2024, there were no potentially dilutive securities included in the calculation of weighted-average common shares outstanding.

Derivatives

We account for derivatives pursuant to ASC 815, Accounting
for Derivative Instruments and Hedging Activities. All derivative instruments are recognized in the interim condensed consolidated
financial statements and measured at fair value regardless of the purpose or intent for holding them. We determine fair value of warrants
and other option type instruments based on option pricing models. The changes in fair value of these instruments are recorded in income
or expense.

Preferred Shares

The preferred shares carry super-voting rights with
each share issued having the equivalent of 1,550 votes. Preferred shares issued by the Company are not convertible into or exchangeable
for common shares and they are not exchangeable for equity nor redeemable for cash. The preferred shares do not pay dividends. The preferred
shares cannot be sold, exchanged or transferred to another party.

Stock-based compensation

The Company recognizes compensation expenses for all
stock-based payments made to employees, directors and others based on the estimated fair values of its common stock on the date of grant.

    9

VOIP-PAL.COM INC.

Notes to the Interim Condensed Consolidated Financial
Statements

(Unaudited – prepared by management)

(Expressed in United States Dollars)

March 31, 2025

    NOTE 3.
    SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

Stock-based compensation (cont’d)

The Company determines the fair value of the share-based
compensation payments granted as either the fair value of the consideration received or the fair value of the equity instruments issued,
whichever is more reliably measurable. If the fair value of the equity instruments issued is used, it is measured using the stock price
and other measurement assumptions as of the earlier of either the date at which a commitment for performance to earn the equity instrument
is reached or the date the performance is complete.

The Company recognizes compensation expense for stock
awards with service conditions on a straight-line basis over the requisite service period, which is included in operations. Stock option
expense is recognized over the option’s vesting period.

Concentrations of Credit