Company: RIVF
Filing Date: 2025-10-15
Form Type: 10-K
Source: 0001493152-25-018109
Chunk: 381

Company: Rivulet Entertainment, Inc.
Filing Date: 2025-10-15
Form: 10-K
Item: Item 7
Chunk 381
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In
determining the transaction price, the Company’s contracts with its customers do not include a significant financing component,
non-cash consideration or consideration payable to the customer. However, the Company’s contracts typically will include sales-based
or usage-based royalties that are triggered by the attainment of certain levels of box office receipts or video on demand (“VOD”)
purchases. To that extent, in accordance with ASC 606-10-55, the Company will recognize the sales-based or usage-based royalties only
when the later of the following events occur-a) the subsequent sale or usage occurs or b) the performance obligation to which the sales-based
or usage-based royalty has been satisfied.

As
it pertains to incremental costs of obtaining a contract, the Company does not incur any type of sales commissions.

Investments
in Equity Securities

The
Company accounts for its investments in equity securities without a readily determinable fair value at cost minus impairment in accordance
with ASC 321, Investments-Equity Securities. Further, the Company will continue to recognize its investments without a readily
determinable fair value at cost minus impairment until the investment does not qualify to be measured as such. To that extent, the Company
will re-assess at the end of each reporting period whether the investment still qualifies to be recognized at cost minus impairment.

In
addition to assessing whether the investments still qualify to be recognized at cost minus impairment, the Company will also make a
qualitative assessment at the end of each reporting period considering impairment indicators to evaluate whether the investment is
impaired. If the qualitative assessment indicates that the investment is impaired and the fair value of the investment is less than
its carrying value, then the investment will be written down to fair value. During the twelve months ended June 30, 2025, the
Company recognized a $1.0 million impairment on its original $2.0 million investment, resulting in a carrying value of $1.0 million
as of June 30, 2025. The Company did not recognize any impairment for the twelve months ended June 30, 2024. 

11

Recent
Accounting Pronouncements

In
November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07,
Segment Reporting - Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which requires incremental
disclosures related to a public entity’s reportable segments.