Company: IPSI
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110820
Chunk: 183

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 183
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Foreign Exchange Risks

We intend to operate in several
foreign countries. Changes and fluctuations in the foreign exchange rate between the US Dollar and other foreign currencies may in future
have an effect our results of operations.

32

Critical Accounting Estimates

Preparation of our financial
statements in accordance with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of certain assets,
liabilities, revenues and expenses, as well as related disclosure of contingent assets and liabilities. Significant accounting policies
are fundamental to understanding our financial condition and results as they require the use of estimates and assumptions which affect
the financial statements and accompanying notes. See Note 2 - Summary of Significant Accounting Policies of the Notes to the condensed
Financial Statements included in Part I, Item I of this Form 10-Q for further information.

The critical accounting policies
that involved significant estimation included the following:

Derivative liabilities

We have certain short-term
convertible debt and certain warrants which have fundamental transaction clauses which might result in cash settlement. The conversion
feature of these convertible notes and warrants are recorded as derivative liabilities which are valued at each reporting date.

The derivative liability is
valued using the following inputs:

    ●
    Conversion prices;

    ●
    Current market prices of our equity

    ●
    Risk free interest rates;

    ●
    Expected remaining life of the derivative liability;

    ●
    Expected volatility of the underlying stock; and expected dividend rates

Any change in the above factors
such as a change in risk free interest rates, a significant increase or decrease in our current stock prices and a change in the volatility
of our Common Stock may result in a significant increase or decrease in the derivative liability.

Results of Operations

Results of Operations for the Three Months Ended September 30, 2025
and 2024

Net revenue

We had no revenues for the
three months ended September 30, 2025 and 2024. We pivoted to focus our attention on the IPSIPay Express joint venture and potential payment
processing opportunities to generate revenues, however there can be no guarantees that we will be successful in our endeavors.

Cost of goods sold

We had no cost of goods sold
for the three months ended September 30, 2025 and 2024.

General and administrative expenses

General and administrative
expenses were $366,117 and $296,438 for the three months ended September 30, 2025 and 2024, respectively, an increase of $69