Company: LNAI
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001731122-25-000765
Chunk: 12

Company: Lunai Bioworks Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 1
Chunk 12
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5 are not necessarily indicative of the operating results for
the full year.

Consolidation – For
the three and nine months ended March 31, 2025, and 2024, the condensed consolidated financial statements include the accounts and operations
of the Company and its subsidiaries. All material inter-company transactions and accounts have been eliminated in the consolidation.

Accounting Estimates –
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent assets and liabilities at the
date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ
from those estimated. Significant estimates include the fair value of assets acquired in a business acquisition, contingent consideration,
and equity instruments issued for goods or services.

Loss Per Share –Basic
earnings per common share (EPS) are based on the weighted average number of shares of Common Stock outstanding during each period. Diluted
earnings per common share are based on shares outstanding (computed as under basic EPS) and potentially dilutive shares of Common Stock.
Potential shares of Common Stock included in the diluted earnings per share calculation include in-the-money stock options that have been
granted but have not been exercised and shares issuable upon conversion of convertible preferred stock and convertible notes. Because
of the net loss for the nine months ended March 31, 2025, and 2024, the dilutive shares for all periods were excluded from the Diluted
EPS calculation as the effect of these potential shares of Common Stock is anti-dilutive. The Company had 12,850,390 and 9,522,967 potential
shares of Common Stock excluded from the Diluted EPS calculation as of March 31, 2025, and 2024, respectively.

    8

Functional Currency & Foreign
Currency Translation – The functional currency of Renovaro Biosciences Denmark ApS is the Danish Kroner (“DKK”)
and the functional currency of Renovaro Cube is the Euro (“EUR”). The Company’s reporting currency is the U.S. Dollar
for the purpose of these financial statements. The Company’s balance sheet accounts are translated into U.S. dollars at the period-end
exchange rates and all revenue and expenses are translated into U.S. dollars at the average exchange rates prevailing during the periods
ended March 31, 2025, and 2024. Translation gains and losses are deferred and accumulated as