Company: BRID
Filing Date: 2025-01-29
Form Type: 10-K
Source: 0001493152-25-004182
Chunk: 232

Company: BRIDGFORD FOODS CORP
Filing Date: 2025-01-29
Form: 10-K
Item: Item 1C
Chunk 232
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    Depreciation 
     (12,069) 
     (12,342)
  
    Net operating loss carry-forward and credits 
     1,721  
     322 
  
    Right of use assets 
     (235) 
     - 
  
    Valuation allowance established against state NOL 
     (99) 
     (99)
  
    Deferred income taxes, net 
    $(7,622) 
    $(8,342)

Management is required to evaluate whether a valuation
allowance should be established against its deferred tax assets based on the consideration of all available evidence using a “more
likely than not” standard. Realization of deferred tax assets is dependent upon taxable income in prior carryback years, estimates
of future taxable income, tax planning strategies, and reversals of existing taxable temporary differences.

As of November 1, 2024, the Company did not have
any valuation allowance against its federal net deferred tax assets. Management reevaluated the need for a valuation allowance at the
end of 2023 and determined that some of its California NOL may not be utilized. Therefore, a valuation allowance of $99 has been retained
for such portion of the California NOL.

As of November 1, 2024, the Company had net operating
loss carryforwards of approximately $5,000 for federal and $12,800 for state purposes.

The state loss carryforwards will expire at various
dates through 2040.

In July 2006, the FASB issued guidance to clarify
the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. This interpretation prescribed
a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected
to be taken in a tax return. The guidance also discussed derecognition, classification, interest and penalties, accounting in interim
periods, disclosure, and transition. The cumulative effect, if any, of applying this guidance is to be reported as an adjustment to the
opening balance of retained earnings in the year of adoption. The provisions of this guidance have been incorporated into ASC 740-10.

As of November 1, 2024, we have provided a liability
of $349 to unrecognized tax benefits related to various federal and state income tax matters. $76 of this liability will reduce our effective
income tax rate if the asset is recognized in future reporting periods. We have not identified any new unrecognized tax benefits