Company: HCWB
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0000950170-25-046724
Chunk: 294

Company: HCW Biologics Inc.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 1B
Chunk 294
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 determines the extent of the Company’s progress toward completion. As part of the accounting for these arrangements, the Company must develop estimates and assumptions that require judgement to determine the progress towards completion. The Company reviews its estimate of the progress toward completion based on the best information available to recognize the cumulative progress toward completion as of the end of each reporting period, and makes revisions to such estimates, if facts and circumstances change during each reporting period. Any such revisions are recorded on a cumulative catch-up basis, noting no material revisions during the years ended December 31, 2023 and 2024.  For each in process SOW, amounts are billed in the same quarter the costs are incurred.   For the years ended December 31, 2023 and 2024, the Company recognized revenues related to sale of development supply materials to Wugen of $2.8 million and $2.6 million, respectively. Accounts Receivable, Net Accounts receivable is presented in accordance the current expected credit losses (“CECL”) impairment model as required under Topic 326.  The Company estimates a reserve for expected credit losses based on existing contractual payment terms, actual payment patterns of its customers, current and future economic and market conditions and individual customer circumstances. As of December 31, 2023 or December 31, 2024, the Company determined that a reserve for expected credit losses was not required. No accounts were written off during the periods presented.Deferred RevenueDeferred revenue represents amounts billed, or in certain cases, yet to be billed to the Company’s customer for which the related revenues have not been recognized because one or more of the revenue recognition criteria have not been met. The current portion of deferred revenue represents the amount to be recognized within one year from the balance sheet date based on the estimated performance period of the underlying performance obligations.  There were no deferred revenue balances as of December 31, 2023 or 2024. Investments The Company holds a minority interest in Wugen. The underlying shares of common stock are not traded on any public market and thus have limited marketability.  The Company does not have any influence over the operating and financial policies of Wugen. As a result, the Company has accounted for this investment using the measurement alternative whereby the investment is recorded at cost less impairment, adjusted for observable price changes in orderly transactions for an identical or similar investment of the same investee.  No impairment was recognized during the years ended December 31, 2023 and 2024.  See Note