Company: CELH
Filing Date: 2025-03-03
Form Type: 10-K
Source: 0001341766-25-000024
Chunk: 96

Company: Celsius Holdings, Inc.
Filing Date: 2025-03-03
Form: 10-K
Item: Item 8
Chunk 96
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 estimating consumer participation and/or distributor and retail customer performance levels to determine the accrual. The estimated promotional expenditures are recorded as a reduction to revenue in the period the underlying sale occurs to customers. Total promotional expenditures included as a reduction to revenue were $455.1 million for the year ended December 31, 2024, and accrued promotional allowances were $135.9 million at December 31, 2024.We identified accrued promotional allowances as a critical audit matter because of the extent and subjective nature of management judgment required with respect to estimating consumer participation and/or distributor and retail customer performance levels and future promotional claims in determining the accrual for promotional allowances not yet invoiced by customers at year end.How We Addressed the Matter in Our AuditTo test accrued promotional allowances, our audit procedures included, among others, evaluating management’s judgments regarding estimating the promotional allowances not yet invoiced by its customers as of December 31, 2024. We assessed the reasonableness of management’s estimates of the accrued promotional allowances for a sample of customers by developing an expectation of the amount, primarily based on contractual terms in agreements with customers and the historical promotional expenditure amounts per case or as a percentage of sales, and we compared our expectation to management’s recorded estimate. We performed inquiries of the Company’s sales and marketing personnel to corroborate our understanding of new and existing promotional programs that may alter the relationship between gross billings and promotional allowances, as such programs are considered by management when estimating future promotional claims. In addition, we tested the accuracy and completeness of the underlying data used in management’s estimation calculations, as well as the clerical accuracy of such calculations. We also evaluated management’s ability to estimate promotional allowances by comparing the actual invoices for promotional allowances subsequently paid to management’s original estimates.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2021.

Boca Raton, Florida

March 3, 2025

F-4

Celsius Holdings, Inc.

Consolidated Balance Sheets

(in thousands, except share and per share amounts)

December 31, 2024December 31, 2023ASSETSCurrent assets:Cash and cash equivalents$890,190 $755,981 Accounts receivable-net[1]270,342 183,703 Note receivable-net— 2,318 Inventories-net131,165 229,275 Deferred other costs-current[2]14,124 14,124 Prepaid expenses and other current assets18,