Company: RSKD
Filing Date: 2025-03-06
Form Type: 20-F
Source: 0001851112-25-000006
Chunk: 203

Company: RISKIFIED LTD.
Filing Date: 2025-03-06
Form: 20-F
Item: Item 19
Chunk 203
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 the collectability of accounts. We regularly review the adequacy of the allowance for credit losses based on a combination of factors, including an assessment of the current merchant’s credit worthiness, the age of the balance, the nature and size of the merchant, the financial condition of the merchant, and the amount of any receivables in dispute. Accounts receivable deemed uncollectible are charged against the allowance for credit losses when identified. 0.8 0.5

The following table represents a roll-forward of the allowance for credit losses:

                                                            Year Ended December 31,                                
                                                            2024                                  2023             
                                                            (in thousands)                                         
 ───────────────────────────────────────────────────────────────────────────────────────────────────────────────────
  Beginning balance                                         $                            515      $           487  
  Current period provision                                  626                                   198              
  Uncollectible accounts charged against the allowance      ( 354)                                ( 170)           
  Ending balance                                            $                            787      $           515  

Derivative Financial Instruments

We enter into derivative instruments to manage risks relating to our ongoing business operations. We enter into foreign currency forward and option contracts with financial institutions to protect against foreign exchange risks attributable to our exposure to changes in the exchange rates of (a) the New Israeli Shekel (“ NIS”) against the U. S. dollar and (b) the Euro against the U. S. dollar. Our primary objective in entering into these contracts is to reduce the volatility of forecasted earnings and cash flows associated with changes in foreign currency exchange rates. We do not use derivative instruments for trading or speculative purposes.

We account for our derivative instruments as either assets or liabilities and carry them at fair value. The accounting for changes in the fair value of a derivative depends on the intended use of the derivative and the resulting designation. Derivative instruments are recorded as either prepaid expenses and other current assets or accrued expenses and other current liabilities in the consolidated balance sheets. We record changes in the fair value of derivative instruments that are designated as hedging instruments in accumulated other comprehensive profit (loss) in the consolidated balance sheets, until the forecasted transaction occurs upon which we reclassify the related gain or loss on the derivative to the same financial statement line item in the consolidated statements of operations to which the derivative relates.

Other derivatives not designated as hedging instruments consist primarily of foreign currency forward contracts that we use to hedge monetary assets or liabilities denominated in currencies other than the functional currency of a subsidiary. Changes in the fair