Company: LSEB
Filing Date: 2025-07-15
Form Type: 10-K
Source: 0001199835-25-000233
Chunk: 386

Company: LSEB Creative Corp.
Filing Date: 2025-07-15
Form: 10-K
Item: Item 4
Chunk 386
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 necessary to appropriately value goods that are obsolete, have quality issues, or are
damaged. The amount of the provision is equal to the difference between the cost of the inventory and its net realizable value based
upon assumptions about product quality, damages, future demand, selling prices, and market conditions. If changes in market conditions
result in reductions in the estimated net realizable value of its inventory below its previous estimate, the Company would increase its
reserve in the period in which it made such a determination.

In
addition, the Company provides for inventory shrinkage based on historical trends from actual physical inventory counts. Inventory shrinkage
estimates are made to reduce the inventory value for lost or stolen items. The Company performs physical inventory counts and cycle counts
throughout the year and adjusts the shrink reserve accordingly. As of March 31, 2025, the Company has no obsolescence provisions, damage
provisions, or shrinkage provisions.

Foreign
Currency Translation

The
functional currency of the Company is United States dollar. Transactions denominated in currencies other than the functional currency
are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities
denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. All exchange gains or
losses arising from translation of these foreign currency transactions are included in Statement of operations. The Company has not,
to the date of these financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.

Fair
Value of Financial Instruments

ASC
820 defines fair value, establishes a framework for measuring fair value and expands required disclosure about fair value measurements
of assets and liabilities. ASC 820-10 defines fair value as the exchange price that would be received for an asset or paid to transfer
a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between
market participants on the measurement date. ASC 820-10 also establishes a fair value hierarchy, which requires an entity to maximize
the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels
of inputs that may be used to measure fair value:

    ●
    Level
    1 – Valuation based on quoted market prices in active markets for identical assets or liabilities.

    ●
    Level
    2 – Valuation based on quoted market prices for similar assets and liabilities in active markets.

    ●