Company: FWDI
Filing Date: 2025-09-16
Form Type: 8-K
Source: 0001683168-25-007036
Chunk: 18

Company: Forward Industries, Inc.
Filing Date: 2025-09-16
Form: 8-K
Item: Item 8
Chunk 18
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 most notably the tax
rate reconciliation and income taxes paid. This ASU is effective for fiscal years beginning after December 15, 2024 on a prospective basis
and retrospective application is permitted. The Company is currently evaluating the effects of this pronouncement on its consolidated
financial statements.

In November 2023, the FASB issued
ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,” which requires expanded segment
reporting and disclosure and is effective for the Company for fiscal years beginning after December 15, 2023, and interim periods within
fiscal years beginning after December 15, 2024. The Company is currently evaluating the effects of this pronouncement on its consolidated
financial statements.

In November 2019, the FASB issued
ASU 2019-11, “Codification Improvements to Topic 326, Financial Instruments – Credit Losses.” ASU 2019-11 is an accounting
pronouncement that provides clarity to and amends earlier guidance on this topic and would be effective concurrently with the adoption
of such earlier guidance. This pronouncement is effective for the Company for fiscal years beginning after December 15, 2022, and interim
periods within those fiscal years. The Company adopted this guidance in the first quarter of Fiscal 2024 with no material impact on its
consolidated financial statements.

NOTE 3         DISCONTINUED
OPERATIONS AND ASSETS HELD FOR SALE

Considering the recurring losses
incurred by the retail segment, in July 2023, the Company decided to cease operations of its retail distribution segment (“Retail
Exit”). The primary assets of the retail segment were inventory and accounts receivable. The Company sold, liquidated, or otherwise
disposed of the remaining retail inventory as of September 30, 2024, and collected all remaining retail accounts receivable by the end
of Fiscal 2024. As of September 30, 2024, the retail segment was fully discontinued, and we expect to have no further significant involvement
in this segment. The Retail Exit is considered a strategic shift that will have a significant impact on the Company’s operations
and financial results. The inventory of the retail segment meets the criteria to be considered “held-for-sale” in accordance
with ASC 205-20, “Discontinued Operations.” Accordingly, the retail inventory is classified on our consolidated balance sheet
as “assets held for sale” at