Company: IPSI
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110820
Chunk: 22

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 22
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 advertising costs amounted to $325 and
$5,991 for the three months ended September 30, 2025 and 2024, respectively, and $325 and $154,864 for the nine months ended September
30, 2025 and 2024, respectively.

12

INNOVATIVE PAYMENT SOLUTIONS, INC.

Notes to the Unaudited
Condensed Financial Statements

2ACCOUNTING
POLICIES AND ESTIMATES (continued)

q)Income Taxes

The Company is based in the U.S. and
currently enacted U.S. tax laws are used in the calculation of income taxes.

Income taxes are computed using the
asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the
differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates
and laws. A full valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected
to be realized. It is the Company’s policy to classify interest and penalties on income taxes as interest expense or penalties expense.
As of September 30, 2025 and December 31, 2024, there have been no interest or penalties incurred on income taxes.

r)Comprehensive
income

Comprehensive income is defined as the
change in equity of a company during a period from transactions and other events and circumstances excluding transactions resulting from
investments from owners and distributions to owners. The Company does not have any comprehensive income (loss) for the periods presented.

s)Reclassification
of prior year presentation

Certain prior year amounts have been
reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.

3LIQUIDITY
MATTERS AND GOING CONCERN

The Company’s financial statements
are prepared using U.S. GAAP applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities
in the normal course of business. The Company has incurred net losses since its inception and anticipates net losses and negative operating
cash flows for the near future. For and as of the nine months ended September 30, 2025, the Company had a net loss of $48.3 million,
after deemed dividends of $1.8 million. In connection with preparing the unaudited condensed financial statements for the nine months
ended September