Company: GAME
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004869
Chunk: 325

Company: GameSquare Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1C
Chunk 325
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 net amount
of commission made by the Company.

Deferred
revenue consists of customer advances for Company services to be rendered that will be recognized as income in future periods.

(f)
Cash and restricted cash

The
Company maintains cash deposits with major banks, financial institutions, and other custodians. Deposits at each financial institution
are insured in limited amounts by the Federal Deposit Insurance Corporation (“FDIC”). At times cash balances held at financial
institutions are more than FDIC insured limits. Bank overdrafts that are repayable on demand and form an integral part of the Company’s
cash management are included as a component of cash for the purpose of the statement of cash flows. Restricted cash is related to the
players liability account within current liabilities and is presented as a separate category on the consolidated balance sheets and cash
restricted for purposes of securing a standby letter of credit covering lease deposits.

(g)
Accounts receivable and allowance for credit losses

Trade
accounts receivable are recorded at the invoiced amount and generally do not bear interest. The Company follows the allowance method
of recognizing uncollectible accounts receivable, which recognizes bad debt expense based on a review of the individual accounts outstanding
and prior history of uncollectible accounts receivable. Credit is extended based on evaluation of each of our customer’s financial
condition and is generally unsecured. Accounts receivable are stated net of an allowance for doubtful accounts in the consolidated balance
sheets. An allowance for doubtful accounts is established at origination and is based on the lifetime expected credit losses of the trade
receivables in consideration of a number of factors, including the length of time trade accounts are past due, previous loss history,
the creditworthiness of individual customers, and future economic outlook. The amount of any increase in the allowance for doubtful accounts
is recognized in the consolidated statements of operations and comprehensive loss. When a trade receivable is uncollectible, it is written
off against the allowance. Subsequent recoveries of amounts previously written off are credited to the consolidated statements of operations
and comprehensive loss. The Company had an allowance for doubtful accounts of $2.8 million and $1.2 million as of December 31, 2024 and
2023, respectively.

    F-15

(h)
Prepaid expenses and other current assets

Prepaid
expenses and other assets consist primarily of prepaid expenses such as insurance as well as acquisition costs of players and security
deposits. Acquisition costs of players are amortized on a straight-line basis