Company: GAME
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004869
Chunk: 201

Company: GameSquare Holdings, Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1B
Chunk 201
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 certain. Expenditure on development activities, whereby research findings are applied to a plan or design to produce new or
substantially improved products and processes, is capitalized if the product or process is technically and commercially feasible and
the Company has sufficient resources to complete development. The expenditure capitalized includes the cost of materials, direct labor
and an appropriate proportion of overheads. Other development expenditure is recognized in the consolidated statement of loss and comprehensive
loss as an expense as incurred. Capitalized development expenditure is stated at cost less accumulated amortization and impairment losses.

    F-17

(p)
Impairment of long-lived assets and goodwill

Long-lived
assets consist of property and equipment, right-of-use assets and intangible assets. The Company assesses for impairment of asset groups,
including intangible assets, at least annually, or more frequently if there are any indicators for impairment.

Goodwill
and indefinite life intangible assets are tested for impairment annually or when there is an indication that the asset may be impaired.

When
a triggering event that occurred during the reporting period is identified, or when the annual impairment test is required, the Company
may first assess qualitative factors to determine whether it is more likely than not that goodwill is impaired. If the Company determines
it is more likely than not that goodwill is not impaired, an impairment test is not necessary. If an impairment test is necessary, management
estimates the fair value of the Company. If the carrying value of the Company exceeds its fair value, goodwill is determined to be impaired,
and an impairment charge equal to the excess of the carrying value over the related fair value of the Company will be recorded. If the
qualitative assessment indicates that it is more likely than not that goodwill is not impaired, further testing is unnecessary.

(q)
Leases

The
Company determines if an arrangement is a lease at its inception. Lease arrangements are comprised primarily of real estate for which
the right-of-use (“ROU”) assets and the corresponding lease liabilities are presented separately on the consolidated balance
sheets.

ROU
assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease
payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the estimated
present value of lease payments over the lease term. The lease term includes options to extend the lease when it is reasonably certain
that the option will be exercised. Leases with a term of 12 months or less are not recorded on the