Company: NTWK
Filing Date: 2025-09-29
Form Type: 10-K
Source: 0001493152-25-015950
Chunk: 195

Company: NETSOL TECHNOLOGIES INC
Filing Date: 2025-09-29
Form: 10-K
Item: Item 1
Chunk 195
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    $903,766 

The
Company used the discounted cash flow method with interest rates ranging from 4.2% to 17.5%, for the year ended June 30, 2025 and 2024.

Unearned
Revenue

Unearned
revenue represents billings in excess of revenue earned on contracts and are recognized on a pro-rata basis over the life of the contract.

Cost
of Revenues

Cost
of revenues includes salaries and benefits for technical employees, consultant costs, amortization of capitalized computer software
development costs, depreciation of computer and equipment, travel costs, and indirect costs such as rent and insurance.

Advertising
Costs

The
Company expenses the cost of advertising as incurred. Advertising costs for the years ended June 30, 2025 and 2024 were $346,232 and
$148,953, respectively.

Share-Based
Compensation

The
Company records stock compensation in accordance with ASC 718, Compensation – Stock Compensation. ASC 718 requires companies
to measure compensation cost for stock employee compensation at fair value at the grant date and recognize the expense over the employee’s
requisite service period. The Company recognizes forfeitures as they occur. The Company recognizes in the statement of operations the
grant-date fair value of stock options and other equity-based compensation issued to employees and non-employees.

    F-14

NETSOL
TECHNOLOGIES, INC.

Notes
to Consolidated Financial Statements

June
30, 2025 and 2024

Income
Taxes

Income
taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective
tax bases and operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect
on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
A valuation allowance is provided for deferred tax assets if it is more likely than not these items will either expire before the Company
is able to realize their benefits, or that future deductibility is uncertain.

When
tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities,
while others are subject to uncertainty