Company: SNBH
Filing Date: 2025-04-16
Form Type: 10-K
Source: 0001731122-25-000581
Chunk: 451

Company: SENTIENT BRANDS HOLDINGS INC.
Filing Date: 2025-04-16
Form: 10-K
Item: Item 6
Chunk 451
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 received from customers
prior to the products being delivered are recorded as advance from customers. In these cases, when the products are sold, the amount recorded
as advance from customers is recognized as revenue.

Income Taxes

We are governed by the income
tax laws of the United States. Income taxes are accounted for pursuant to ASC 740 “Accounting for Income Taxes,” which is
an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences
of events that have been recognized in our financial statements or tax returns. The charge for taxes is based on the results for the period
as adjusted for items, which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively
enacted by the balance sheet date.

Deferred tax is accounted
for using the balance sheet liability method in respect of temporary differences arising from differences between the carrying amount
of assets and liabilities in the financial statements and the corresponding tax basis used in the computation of assessable tax profit.
In principle, deferred tax liabilities are recognized for all taxable temporary differences, and deferred tax assets are recognized to
the extent that it is probably that taxable profit will be available against which deductible temporary differences can be utilized.

Deferred tax is calculated
using tax rates that are expected to apply to the period when the asset is realized, or the liability is settled. Deferred tax is charged
or credited in the income statement, except when it is related to items credited or charged directly to equity, in which case the deferred
tax is changed to equity. Deferred tax assets and liabilities are offset when they related to income taxes levied by the same taxation
authority and we intend to settle its current tax assets and liabilities on a net basis.

Stock-based Compensation

Stock based compensation is accounted for based on
the requirements of the Share-Based Payment topic of Accounting Standards Codification (“ASC”) 718 which requires recognition
in the financial statements of the cost of employee and director services received in exchange for an award of equity instruments over
the period the employee or director is required to perform the services in exchange for the award. The Accounting Standards Codification
also requires measurement of the cost of employee and director services received in exchange for an award based on the grant-date fair
value of the award.

Pursuant to ASC Topic 505-50, for share-based payments
to consultants and other third-parties, compensation expense is determined at the “measurement date.” The expense is recognized
over the period of services