Company: RIVF
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001641172-25-024216
Chunk: 13

Company: Rivulet Entertainment, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 13
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 taxes under ASC 740, “Income Taxes.” Deferred
tax assets and liabilities are recognized for the estimated 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 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. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period
that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected
to be realized.

ASC
740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions
taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be
sustained upon examination by taxing authorities. The Company is currently not aware of any issues under review that could result in
significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing
authorities since inception.

Concentration
of Credit Risk

Financial
instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution,
which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. As of December 31, 2024, the Company has not experienced
losses on this account and management believes the Company is not exposed to significant risks on such account.

In
addition, virtually the Company’s entire accounts receivable balance as of December 31, 2024 is with a single customer. However, the Company believes
that the customer is in good credit standing and does not have reason to believe that there any collectability issues with the outstanding
balance.

Accounts
Receivable

Accounts
receivable, net of the allowance for doubtful accounts, represent their estimated net realizable value, which approximates fair
value. Provisions for doubtful accounts are recorded based on historical collection experience, current conditions and reasonable
and supportable forecasts. Receivables are written off when they are deemed uncollectible. As of December 31, 2024 and June 30,
2024, the Company had an accounts receivable balance of $6.6 million and $0 million, respectively. All amounts were deemed
collectable as of December 31, 202