Company: APPN
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001441683-25-000017
Chunk: 120

Company: APPIAN CORP
Filing Date: 2025-02-19
Form: 10-K
Item: Item 8
Chunk 120
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 all or a portion of the deferred tax asset will not be realized. Our tax positions are subject to income tax audits by multiple tax jurisdictions throughout the world. We recognize the tax benefit of an uncertain tax position only if it is more likely than not the position is sustainable upon examination by the taxing authority. We measure the tax benefit recognized as the largest amount of benefit which is more likely than not to be realized upon settlement with the taxing authority. We recognize penalties and interest related to unrecognized tax benefits as income tax expense. We calculate the current and deferred income tax provision based on estimates and assumptions that could differ from the actual results reflected in income tax returns filed in subsequent years and record adjustments based on filed income tax returns when identified. The amount of income taxes paid is subject to examination by U.S. federal, state, and foreign tax authorities. The estimate of the potential outcome of any uncertain tax issue is subject to our assessment of relevant risks, facts, and circumstances existing at that time. To the extent the 

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APPIAN CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS

assessment of such tax position changes, we record the change in estimate in the period in which we make that determination.Foreign CurrencyOur operations located outside of the United States where the local currency is the functional currency are translated into U.S. dollars using the current rate method. Results of operations are translated at the average rate of exchange for the period. Assets and liabilities are translated at the closing rates on the balance sheet date. Gains and losses on translation of these accounts are accumulated and reported as a separate component of stockholders’ equity and other comprehensive loss. Gains and losses on foreign currency transactions are recognized in the accompanying consolidated statements of operations as a component of ‘Other expense (income), net’. Gains and losses from transactions denominated in foreign currencies resulted in net transaction losses of $16.8 million, net transaction gains of $8.7 million, and net transaction losses of $6.1 million for the years ended December 31, 2024, 2023, and 2022, respectively.Research and Development ExpensesResearch and development expenses include payroll, employee benefits, and other headcount-related costs associated with product development. Our product utilizes a common codebase, whether accessed by customers via the cloud or via an on-premises installation. Since our software is sold and licensed externally, we consider our software as external-use software for purposes of applying the capitalized software development guidance. Product development costs are expensed as incurred until