Company: GCL
Filing Date: 2025-08-27
Form Type: DRS
Source: 0001213900-25-080905
Chunk: 318

Company: GCL Global Holdings Ltd
Filing Date: 2025-08-27
Form: DRS
Chunk 318
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 deferred tax assets
and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted
tax rates that will be in effect in the period in which the differences are expected to reverse. The Company records a valuation allowance
to offset deferred tax assets if based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the
deferred tax assets will not be realized. The assessment of realizability of deferred tax assets involves significant assumptions used
in the projection of future taxable income and the future reversal pattern of taxable temporary differences. The effect on deferred taxes
of a change in tax rate is recognized in tax expense in the period that includes the enactment date of the change in tax rate.

The Company accounted for uncertainties in income taxes in accordance
with ASC 740. The amount of interest expense is computed by applying the applicable statutory rate of interest to the difference between
the tax position recognized and the amount previously taken or expected to be taken in a tax return. Interest and penalties recognized
in accordance with ASC 740 are classified in the consolidated statements of comprehensive income as income tax expense.

In accordance with the provisions of
ASC 740, the Company recognizes in its consolidated financial statements the impact of a tax position if a tax return position or future
tax position is “more likely than not” to prevail based on the facts and technical merits of the position. Tax positions that
meet the “more likely than not” recognition threshold are measured at the largest amount of tax benefit that has a greater
than fifty percent likelihood of being realized upon settlement. The Company’s estimated liability for unrecognized tax benefits,
if any, will be recorded in the “other non-current liabilities” in the accompanying consolidated financial statements is periodically
assessed for adequacy and may be affected by changing interpretations of laws, rulings by tax authorities, changes and/or developments
with respect to tax audits, and expiration of the statute of limitations. The actual benefits ultimately realized may differ from the
Company’s estimates. As each audit is concluded, adjustments, if any, are recorded in the Company’s consolidated financial
statements. Additionally, in future periods, changes in facts, circumstances, and new information may require the Company to adjust the
recognition and measurement estimates with regard to individual tax positions. Changes in recognition and measurement estimates are recognized
in the period in which the changes occur.

Contingencies

The Company adheres to ASC 450, “Contingencies”
for the recognition, measurement