Company: HCTI
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076686
Chunk: 12

Company: Healthcare Triangle, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 12
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 2024 
  
    Accounts receivable, (net) 
    $1,862  
    $1,110 

Allowance for Doubtful Accounts

Trade accounts receivable are stated at the amount
the Company expects to collect and do not bear interest. The collectability of trade receivable balances is regularly evaluated based
on a combination of factors such as customer creditworthiness, past transaction history with the customer, current economic industry trends
and changes in customer payment pattern. Additionally, if it is determined that a customer will be unable to fully meet its financial
obligation, such as in the case of a bankruptcy filing or other material event impacting its business, a specific allowance for doubtful
accounts may be recorded to reduce the related receivable to the amount expected to be recovered.

Although we believe that our approach to significant
estimates and judgments regarding our allowance for doubtful accounts is reasonable, actual results could differ and we may be exposed
to increases or decreases in required allowances that could be material.

Furniture and Equipment

Furniture and equipment are stated at cost. The
Company provides for depreciation of furniture and equipment using the straight-line method over the estimated useful lives of the related
assets ranging from 3 to 7 years. Leasehold improvements are amortized using the straight-line method over the shorter of the lease terms
or the useful lives of the improvements. The Company charges repairs and maintenance costs that do not extend the lives of the assets
to expenses as incurred.

10

HEALTHCARE TRIANGLE, INC.

Notes To Condensed Consolidated Financial Statements

(Unaudited)

(In thousands except share
and per share data)

Business Combinations

As per ASC 805-50 a common-control transaction
does not meet the definition of a business combination because there is no change in control over the net assets. The accounting for these
transactions are addressed in the “Transactions Between Entities Under Common Control”. The net assets are derecognized by
the transferring entity and recognized by the receiving entity at the historical cost of the parent of the entities under common control.
Any difference between the proceeds transferred or received and the carrying amounts of the net assets is recognized in equity in the
transferring and receiving entities’ separate financial statements and eliminated in consolidation. The change in accounting principle
is applied retroactively for all periods presented.

We account for business combinations using the
acquisition method, which requires the identification of the acquirer, the determination of the acquisition date and the allocation of