Company: ARAI
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023457
Chunk: 52

Company: Arrive AI Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 52
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 estimates and assumptions on
an ongoing basis using historical experience and other factors, including the current economic environment and makes adjustments when
facts and circumstances dictate. These estimates are based on information available as of the date of the financial statements; therefore,
actual results could differ from those estimates.

    - 7 -

ARRIVE
                                            AI INC. 

NOTES
                                            TO FINANCIAL STATEMENTS (Continued)

  2.
  SIGNIFICANT ACCOUNTING
  POLICIES (Continued)

Concentration
of Credit Risk

The
Company maintains its cash balances at two financial institutions. The accounts are insured by the Federal Deposit Insurance Corporation
(FDIC) up to a specified limit. The Company’s balances at the financial institutions periodically exceed federally insured limits.
At September 30, 2025 and December 31, 2024, the Company’s uninsured cash balances totaled approximately $541,775 and $0, respectively.

Management
believes that the Company is not exposed to any significant risk concerning its cash balances. To date, the Company has not recognized
any losses caused by uninsured balances.

Accounts
Receivable and Allowance for Credit Losses

Accounts
receivable are customer obligations due under normal trade terms, which are typically due upon receipt of the invoice. Credit is extended
based on evaluation of a customer’s financial condition and collateral is not required. Accounts receivable are stated at amounts
due from customers net of an allowance for credit losses. The Company recognizes an allowance for expected credit losses at each balance
sheet date. This estimate is derived from a review of the Company’s historical losses based on the aging of receivables. Receivables
with similar risk characteristics are pooled for the estimation of expected credits losses. Management adjusts its historical estimate
based on its assessment of current conditions, reasonable and supportable forecasts regarding future events, and any other factors deemed
relevant by the Company. At each reporting date, the Company updates its estimate of expected credit losses to reflect any changes in
credit risk since the receivable was initially recorded.

The
Company writes off receivables when there is information that indicates the debtor is facing significant financial difficulty and there
is no possibility of recovery. If any recoveries are made from any accounts previously written off, they will be recognized in earnings
in the year of recovery, in accordance with the entity’s accounting policy election. The Company has not incurred material write-offs
as a whole for the nine months ended September 30, 2025. Based upon