Company: FCRS
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110990
Chunk: 56

Company: FutureCrest Acquisition Corp.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 56
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’s major tax jurisdiction. The Company
recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. As of September 30, 2025, there
were no unrecognized tax benefits and no amounts accrued for interest and penalties. 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 considered to be an exempted Cayman
Islands company with no connection to any other taxable jurisdiction and is presently not subject to income taxes or income tax filing
requirements in the Cayman Islands or the United States. As such, the Company’s tax provision was zero for the period presented.

On July 4, 2025, President Trump signed into law
the One Big Beautiful Bill Act. ASC 740, “Income Taxes,” requires the effects of changes in tax laws to be recognized in the
period in which the legislation is enacted. The Company is currently evaluating the impact of the new law. However, none of the tax provisions
are expected to have a significant impact on the Company’s financial statement.

Derivative Financial Instruments

The Company evaluates its financial instruments
to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815,
“Derivatives and Hedging.” For derivative financial instruments that are accounted for as liabilities, the derivative instrument
is initially recorded at its fair value on the grant date and is then re-valued at each reporting date, with changes in the fair value
reported in the statements of operations. The classification of derivative instruments, including whether such instruments should be recorded
as liabilities or as equity, is evaluated at the end of each reporting period. Derivative liabilities are classified in the balance sheet
as current or non-current based on whether or not net cash settlement or conversion of the instrument could be required within 12 months
of the balance sheet date.

8

FUTURECREST ACQUISITION CORP.

NOTES TO CONDENSED FINANCIAL STATEMENT

SEPTEMBER 30, 2025

(Unaudited)

Warrant Instruments

The Company accounted for the Public and Private
Placement Warrants issued in connection with the Initial Public Offering and the private placement in accordance with the guidance contained
in FASB ASC Topic 815, “Derivatives and Hedging.” Accordingly, the Company evaluated and classified the warrant instruments
under equity treatment at their assigned values. As of September 30,