Company: DSNY
Filing Date: 2025-11-24
Form Type: 10-K
Source: 0001062993-25-016994
Chunk: 85

Company: DESTINY MEDIA TECHNOLOGIES INC
Filing Date: 2025-11-24
Form: 10-K
Item: Item 2
Chunk 85
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ivables are shown net of allowance for bad or doubtful accounts.

                            26
                            
                            2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CONT'D

                            Allowance for doubtful accounts
                            The Company establishes an allowance for doubtful accounts to ensure trade and other receivables are not overstated due to non-collectability. The Company's allowance is based on a variety of factors, including age of the receivable, significant one-time events, historical experience, and other risk considerations. The amount ultimately realized from trade accounts receivable may differ from the amount estimated in the consolidated financial statements based on collection experience. The Company had $82,184 and $30,624 in allowance at August 31, 2025 and 2024, respectively. The Company recorded a bad debt of $51,055 and recovery of $2,700 for the years ended August 31, 2025 and 2024, respectively.

                            Property and equipment, net
                            Property and equipment are recorded at cost, less accumulated depreciation. Depreciation and amortization are recognized using the straight-line method over the estimated useful lives of the asset and is calculated using the following rates, commencing upon utilization of the assets: 

                                            Furniture and fixtures
                                            20%

                                            Computer hardware
                                            30%

                                            Computer software
                                            50%

                            Expenditures for repairs and maintenance of assets are charged to expense as incurred. Upon retirement or sale, the cost and related accumulated depreciation of assets disposed of are removed from the accounts and any resulting gain or loss is included in net income (loss).

                                Intangible assets, net
                                Our software solutions are offered to our customers through software as a service delivery models. Development costs associated with the certain solutions offered exclusively through a software as a service model are accounted for in accordance with ASC 350-40.

                                Internal-Use Software.
                                Under ASC 350-40, software development costs related to preliminary project activities and post-implementation and maintenance activities are expensed as incurred. We capitalize direct costs related to application development activities that are probable to result in additional functionality. 
                                Capitalization is limited to costs that are directly attributable to the specific software application and incurred during the application development stage. These costs may include but are not limited to:
                                
                                    Direct costs of materials and services consumed in developing or obtaining internal-use software.
                                    Costs of employees directly associated with the development project, including employee compensation and benefits.
                                    Costs of third-party services utilized in the development process.