Company: WKSP
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001641172-25-000850
Chunk: 14

Company: Worksport Ltd
Filing Date: 2025-03-27
Form: 10-K
Item: Item 8
Chunk 14
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 2024 and 2023, the Company had no impairment losses related to intangible assets.

    50

Worksport
                                            Ltd.

Notes
to the Consolidated Financial Statements

December
31, 2024 and 2023

1.
Description of Business and Significant Accounting Policies (continued)

Product
warranties - The Company currently offers a three year limited warranty  against defective products out-of-the-box.
Customers who are not satisfied with their purchase may attempt to have their purchases reimbursed outside of the warranty
period.

Financial
instruments - FASB ASC 825, Disclosures about Fair Value of Financial Instruments, requires disclosures of the fair value of financial
instruments. The carrying value of the Company’s current financial instruments, which include cash and cash equivalents, accounts
receivable, and accounts payable and accrued liabilities, approximates their fair values because of the short-term maturities of these
instruments. The carrying value of the loan payable approximates fair value as its interest rate fluctuates with market interest rates.
We do not hold or issue financial instruments for trading purposes.

Related
party transactions - All transactions with related parties are in the normal course of operations and are measured at the exchanged
amount.

Reclassifications
– Certain prior year amounts have been reclassified to conform to current year’s presentation. The Company reclassified
accrued liabilities of $800,283 and $190,896 for the fiscal years ended December 31, 2024 and 2023, respectively, which were reclassified
from accounts payable and accrued liabilities to accrued liabilities and other to better align functional classification of obligations.
The Company also reclassified research and development costs of $2,289,940 and $1,669,318 for the fiscal years ended December 31, 2024
and 2023, respectively, which were reclassified from  general and administrative expense, to research and development expense.
This change improves the disclosure of costs to develop new products and technologies and reflects the Company’s ongoing investment
in innovation. This change also provides a more accurate depiction of the Company’s operating performance.

Recent
accounting pronouncements

Recent
accounting pronouncements adopted

In
November 2023, the Financial Standards Accounting Board (FASB) issued Accounting Standards Update (ASU) 2023-07 “Segment Reporting
(Topic 280): Improvements to Reportable Segment Disclosures” which expands annual and interim disclosure requirements
for reportable segments, primarily through