Company: FWDI
Filing Date: 2025-02-13
Form Type: 10-Q
Source: 0001683168-25-000993
Chunk: 8

Company: Forward Industries, Inc.
Filing Date: 2025-02-13
Form: 10-Q
Item: Item 1
Chunk 8
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 but are not necessarily indicative of the results of operations for the year ending September 30, 2025. These condensed consolidated
financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in its
Annual Report on Form 10-K for the fiscal year ended September 30, 2024, and with the disclosures and risk factors presented therein.
The September 30, 2024 condensed consolidated balance sheet has been derived from the audited consolidated financial statements.

Accounting Estimates

The preparation of the Company’s
condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America
(“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and
expenses during the reporting periods. Actual results could differ from those estimates and assumptions. Within this report, certain dollar
amounts and percentages have been rounded to their approximate values.

Segment Reporting

The Company has two reportable
segments: OEM distribution and design. The OEM distribution segment sources and sells carrying cases and other accessories for medical
monitoring and diagnostic kits and a variety of other portable electronic and non-electronic devices (such as sporting and recreational
products, bar code scanners, GPS location devices, tablets and firearms) on a made-to-order basis that are customized to fit the products
sold by our OEM customers worldwide. The design segment consists of two operating segments (IPS and Kablooe, which have been aggregated
into one reportable segment) that provide a full spectrum of hardware and software product design and engineering services to customers
predominantly located in the U.S. See Note 5 for more information on segments.

Accounts Receivable

Accounts receivable consist
of unsecured trade accounts with customers in amounts that have been invoiced ($4,028,000, $4,460,000 and $6,949,000 at December 31, 2024,
September 30, 2024, and September 30, 2023, respectively) and contract assets as described further below under the heading “Revenue
Recognition.” The Company maintains an allowance for credit losses, which is recorded as a reduction to accounts receivable on the
condensed consolidated balance sheets. Collectability of accounts receivable is estimated by evaluating the number of days accounts are
outstanding, customer payment history, recent payment trends and perceived creditworthiness, adjusted