Company: ARAI
Filing Date: 2025-06-05
Form Type: 10-Q
Source: 0001641172-25-013826
Chunk: 13

Company: Arrive AI Inc.
Filing Date: 2025-06-05
Form: 10-Q
Item: Part I, Item 1
Chunk 13
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 the years in which those temporary differences are expected to be recovered or settled. The effect on deferred
tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

A
valuation allowance is recorded for deferred tax assets if it is more likely than not that some portion or all of the deferred tax assets
will not be realized. As of March 31, 2025 and 2024, the Company has recorded a full valuation allowance against its deferred tax assets.
The Company evaluates uncertain income tax positions in order to determine if it is more likely than not that they would be sustained
upon examination.

As
the Company was incorporated in 2020, the Company’s Federal and State income tax returns for all years of operation are subject
to examination by the Internal Revenue Service.

Fair
Value Measurements

Fair
value accounting is applied for all assets and liabilities and non-financial assets and liabilities that are recognized or disclosed
at fair value in the financial statements on a recurring basis (at least annually). Fair value is defined as the exchange price that
would be received for an asset or an exit price that would be paid to transfer a liability in the principal or most advantageous market
for the asset or liability in an orderly transaction between market participants on the measurement date. The Company follows established
frameworks for measuring fair value and expands disclosures about fair value measurements (Note 5).

Recently
Adopted Accounting Guidance

In
November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07,
Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which requires incremental disclosures about reportable segments
but does not change the definition of a segment or the guidance for determining reportable segments. The requirements are effective for
annual reporting periods beginning on January 1, 2024, and are required to be applied retrospectively. The Company has adopted the additional
disclosure requirements under ASU 2023-07. The additional requirements did not have a material impact on the financial statements.

     - 13 - 

ARRIVE
                                            AI INC. 

(FORMERLY
ARRIVE TECHNOLOGY INC.)

NOTES
TO FINANCIAL STATEMENTS (Continued)

3. SEGMENT REPORTING

The
Company’s principal business is described in Note 1. The Company has determined that it operates in a 1 single operating and reportable
segment. The