Company: FORL
Filing Date: 2025-04-30
Form Type: 10-K
Source: 0001213900-25-037576
Chunk: 1133

Company: Four Leaf Acquisition Corp
Filing Date: 2025-04-30
Form: 10-K
Item: Item 5
Chunk 1133
---
 separately.

Income
Taxes

The Company
adopted ASC 740, Income Taxes (“ASC 740”), at its inception. Under ASC 740, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax bases. Deferred tax assets, including tax loss and credit carryforwards, and liabilities are
measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to
be recovered or settled. 

F-19

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.
Deferred income tax expense represents the change during the period in the deferred tax assets and deferred tax liabilities. Deferred
tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all
of the deferred tax assets will not be realized. 

The Company
recognizes the tax benefits of uncertain tax positions only when the positions are “more likely than not” to be sustained
assuming examination by tax authorities and determined to be attributed to the Company. The determination of attribution, if any, applies
for each jurisdiction where the Company is subject to income taxes on the basis of laws and regulations of the jurisdiction. The application
of laws and regulations is subject to legal and factual interpretation, judgement, and uncertainty. Tax laws and regulations themselves
are subject to change as a result of changes in fiscal policy, changes in legislation, the evolution of regulations, and court rulings.
Therefore, the actual liability of the various jurisdictions may be materially different from management’s estimate. As of December
31, 2024 and 2023, the Company has not recorded any amounts related to uncertain tax positions. 

Recent
Accounting Standards 

In August 2020, the FASB issued ASU 2020-06, Debt—Debt
with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic
815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. This guidance changes how entities account
for convertible instruments and contracts in an entity’s own equity and simplifies the accounting for convertible instruments by
removing certain separation models for convertible instruments. This guidance also modifies the guidance on diluted earnings per share
calculations. This new guidance is