Company: CPSS
Filing Date: 2025-03-12
Form Type: 10-K
Source: 0001683168-25-001548
Chunk: 401

Company: CONSUMER PORTFOLIO SERVICES, INC.
Filing Date: 2025-03-12
Form: 10-K
Item: Item 1B
Chunk 401
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 Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments in
this ASU became effective for the Company beginning with this Annual Report on Form 10-K for the year ended December 31, 2024, and we
have adopted using the retrospective transition method. The adoption did not have a material impact on the Company’s consolidated
financial statements. See Note 13 for additional information on the adoption of ASU 2023-07.

(2) Restricted Cash 

Restricted cash consists of
cash and cash equivalent accounts relating to our outstanding securitization trusts and credit facilities. The amount of restricted cash
on our Consolidated Balance Sheets was $125.7 million and $119.3 million as of December 31, 2024 and 2023, respectively.

Our securitization transactions
and one of our warehouse credit facilities require that we establish cash reserves, or spread accounts, as additional credit enhancement.
These cash reserves, which are included in restricted cash, were $62.3 million and $59.0 million as of December 31, 2024 and 2023, respectively.

(3) Finance Receivables

Our portfolio of finance receivables
consists of small-balance homogeneous contracts comprising a single segment and class that is collectively evaluated for impairment on
a portfolio basis according to delinquency status. Our contract purchase guidelines are designed to produce a homogenous portfolio. For
key terms such as interest rate, length of contract, monthly payment and amount financed, there is relatively little variation from the
average for the portfolio. We report delinquency on a contractual basis. Once a contract becomes greater than 90 days delinquent, we do
not recognize additional interest income until the obligor under the contract makes sufficient payments to be less than 90 days delinquent.
Any payments received on a contract that is greater than 90 days delinquent are first applied to accrued interest and then to principal
reduction.

In January 2018 the Company
adopted the fair value method of accounting for finance receivables acquired after 2017. Finance receivables measured at fair value are
recorded separately on the Company’s Balance Sheet and are excluded from all tables in this footnote.

The following table presents the components of
finance receivables, net of unearned interest:

    Schedule of finance receivables 

    December 31, 

    2024  
    2023