Company: NOTV
Filing Date: 2025-12-05
Form Type: 10-K
Source: 0001628280-25-055483
Chunk: 311

Company: Inotiv, Inc.
Filing Date: 2025-12-05
Form: 10-K
Item: Item 1
Chunk 311
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 a known or probable loss is a range, and no amount within the range is a better estimate than any other, the minimum amount of the range is accrued. When determining the estimated loss or range of loss, significant judgment is required to estimate the amount and timing of a loss to be recorded. Estimates of probable losses resulting from litigation, governmental proceedings and other contingencies are inherently difficult to predict, particularly when the matters are in early procedural stages, with incomplete facts or legal discovery; involve unsubstantiated or indeterminate claims for damages; potentially involve penalties, fines, disgorgement, or punitive damages; or could result in a change in business practice.

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Further, in accordance with applicable accounting standards, the Company records an asset in its consolidated financial statements relating to a recovery only when realization of the claim for recovery is deemed probable. An asset should be recognized to the extent that a loss has previously been recognized. Any expected proceeds in excess of a previously recognized loss or a recovery of a loss not yet recognized in the consolidated financial statements should be treated as a gain contingency.

The Company reflects litigation accruals and the related estimated insurance recovery receivable on a gross basis as liabilities and assets, respectively, on our consolidated balance sheet.

Our significant accounting policies, including new accounting pronouncements, are described in more detail in Note 2 - Basis of Presentation and Summary of Significant Accounting Policies of the Notes to Consolidated Financial Statements included in response to Part II, Item 8 of this Report. 

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ITEM 7A – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

We are exposed to changes in interest rates while conducting normal business operations as a result of ongoing financing activities. As of September 30, 2025, our debt portfolio was reliant on reference rates. Based on our interest rate exposure at September 30, 2025, assumed debt levels throughout the next 12 months, a one-percentage-point increase in interest rates would result in an estimated $2.7 million pre-tax reduction in net earnings over a one-year period.

Foreign Currency Exchange Rate Risk

We operate on a global basis and have exposure to some foreign currency exchange rate fluctuations for our financial position, results of operations, and cash flows.

While the financial results of our global activities are reported in U.S. dollars, our foreign subsidiaries typically conduct their operations in their respective local currency. The principal functional currencies of the Company’s foreign subsidiaries are the Euro and British Pound.

Fluctuations in the