Company: FWDI
Filing Date: 2025-12-11
Form Type: 10-K
Source: 0001683168-25-009068
Chunk: 387

Company: Forward Industries, Inc.
Filing Date: 2025-12-11
Form: 10-K
Item: Item 1C
Chunk 387
---
 which are periodically evaluated for reasonableness.

     F-11 

FORWARD INDUSTRIES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Our intangible assets are reviewed
for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In assessing
the recoverability of our intangible assets, we must make estimates and assumptions regarding future cash flows and other factors to determine
the fair value of the respective assets. These estimates and assumptions could have a significant impact on whether an impairment charge
is recognized and the magnitude of any such charge. Fair value estimates are made at a specific point in time, based on relevant information.
These estimates are subjective in nature and involve uncertainties and matters of significant judgments and therefore cannot be determined
with precision. Changes in assumptions could significantly affect the estimates. See Note 4.

Cash

The Company maintains cash deposits
and money market accounts with financial institutions in the United States that at times may exceed federally insured limits of $250,000
per financial institution. At September 30, 2025, there were deposits totaling approximately $37,471,000 held in excess of federally insured
limits. Historically, we have not experienced any losses due to such cash concentrations.

Accounts Receivable

Accounts receivable
consist of unsecured trade accounts with customers net of an allowance for credit losses. Collectability of accounts receivable is estimated
by evaluating the number of days accounts are outstanding, customer payment history, recent payment trends and perceived creditworthiness,
adjusted as necessary based on specific customer situations. At September 30, 2025 and September 30, 2024, the Company had allowances
for credit losses of $92,000 and $27,000, respectively.

Inventories

Inventories consisted primarily
of finished goods and were stated at the lower of cost (determined by the first-in, first-out method) or net realizable value. Based on
management’s estimates, an allowance was made to reduce excess, obsolete, or otherwise unsellable inventories to net realizable
value. If needed, an allowance was established through charges to cost of sales, which is now presented as a component of income/(loss)
from discontinued operations in the Company’s consolidated statements of operations. In determining the adequacy of any allowance,
management’s estimates were based upon several factors, including analyses of inventory levels, historical loss trends, sales history
and