Company: NTWK
Filing Date: 2025-02-13
Form Type: 10-Q
Source: 0001493152-25-006348
Chunk: 15

Company: NETSOL TECHNOLOGIES INC
Filing Date: 2025-02-13
Form: 10-Q
Item: Part I, Item 1
Chunk 15
---
 -  
     (206,964)
  
    Effect of Translation Adjustment 
     (6,957) 
     586  
     (6,371)
  
    Balance at December 31, 2024 
    $892,554  
    $(115,126) 
    $777,428 

Management
analyzes all financial instruments with features of both liabilities and equity under ASC 480, “Distinguishing Liabilities from
Equity” and ASC 815, “Derivatives and Hedging.” Derivative liabilities are adjusted to reflect fair value
at each period end, with any increase or decrease in the fair value being recorded in results of operations as adjustments to fair value
of derivatives. The effects of interactions between embedded derivatives are calculated and accounted for in arriving at the overall
fair value of the financial instruments. In addition, the fair values of freestanding derivative instruments such as warrants and option
derivatives are valued using the Black-Scholes model.

Recent
Accounting Standards:

In November
2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment
Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 expands public entities’ segment disclosures
by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included
within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim
disclosures of a reportable segment’s profit or loss and assets. ASU 2023-07 is effective for the Company’s Annual Report
on Form 10-K for the fiscal year ending June 30, 2025, and subsequent interim periods, with early adoption permitted. We are evaluating
the impact of adopting this ASU on our consolidated financial statements and related disclosures.

    Page 12

NETSOL
TECHNOLOGIES, INC. 

Notes
to Condensed Consolidated Financial Statements 

December
31, 2024 

(Unaudited)

In December
2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, to enhance transparency
and decision usefulness of income tax disclosures, particularly around rate reconciliations and income taxes paid information. ASU 2023-09
is effective for