Company: GCL
Filing Date: 2025-03-17
Form Type: DRS
Source: 0001213900-25-024502
Chunk: 382

Company: GCL Global Holdings Ltd
Filing Date: 2025-03-17
Form: DRS
Chunk 382
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 recorded as a component
of additional paid-in capital at the time of issuance. For issued or modified warrants and rights that do not meet all the criteria for
equity classification, the warrants and rights are required to be treated as liabilities, and recorded at their initial fair value on
the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants and rights are recognized
as a non-cash gain or loss on the statements of operations.

The equity-linked warrants,
both Public and Private warrants, and rights are considered freestanding and outside the scope of ASC 480 as they are not mandatorily
redeemable, are exchanged on a fixed 1:1 ratio and do not obligate the Company to repurchase equity shares. The Company concluded that
the warrants and rights are equity classified under ASC 815 as the warrants and rights are indexed in the Company’s Class A
common stock.

Operating Segments

The Company operates as one
operating segment. Operating segments are defined as components of an enterprise for which separate financial information is regularly
evaluated by the chief operating decision maker (“CODM”), which is the Company’s Chairman and Chief Executive Officer,
in deciding how to allocate resources and assess performance. The Company’s CODM evaluates the Company’s financial information
and resources and assesses the performance of these resources. The Company is not organized by market and is managed and operated as one
business. A single management team that reports to the CODM comprehensively manages the entire business. Accordingly, the Company does
not accumulate discrete financial information with respect to separate divisions and does not have separate operating or reportable segments.
Since the Company operates in one operating segment, all required financial segment information can be found in the financial statements.

Recently Adopted Accounting Pronouncements

In August 2020, the FASB issued
ASU No. 2020-06 Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in
Entity’s Own Equity (Subtopic 815–40) (“ASU 2020-06”). ASU 2020-06 simplifies the accounting for certain financial
instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity.
The ASU is part of the FASB’s simplification initiative, which aims to reduce unnecessary complexity in GAAP. The ASU’s amendments
are effective for smaller reporting companies for fiscal