Company: LTRYW
Filing Date: 2025-08-19
Form Type: 10-Q
Source: 0001641172-25-024882
Chunk: 104

Company: Lottery.com Inc.
Filing Date: 2025-08-19
Form: 10-Q
Item: Part I, Item 8
Chunk 104
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 effect on the balances of current or total assets and prior year’s net loss or accumulated deficit.

Foreign
currency translation

Assets
and liabilities of subsidiaries operating outside the United States with a functional currency other than U.S. Dollars are
translated into U.S. Dollars using period-end exchange rates. Global Gaming operates in Mexican Pesos and the base currency for Sports.com
Media Group Ltd. (formerly  S&MI Ltd.) is British Pounds. Assets and liabilities are translated using period-end exchange
rates. Sales, costs and expenses are translated at the average exchange rates in effect during the reporting period. Foreign
currency translation gains and losses are included as a component of accumulated other comprehensive income (loss).

Cash
and Restricted Cash

As
of June 30, 2025 and December 31, 2024, cash was comprised of cash deposits. From time-to-time cash deposits with some banks may exceed
federally insured limits with the majority of cash held in one financial institution. Management believes all financial institutions
holding its cash are of high credit quality and does not believe the Company is subject to unusual credit risk beyond the normal credit
risk associated with commercial banking relationships.

The
Company had no marketable securities as of June 30, 2025 and December 31, 2024.

     F-8 

Accounts
Receivable

The
Company through its various merchant providers pre-authorizes forms of payment prior to the sale of digital representation of lottery
games to minimize exposure to losses related to uncollected payments and does not extend credit to the user of the B2C Platform or the
commercial partner of the B2B API, which are its customers, in the normal course of business. The Company estimates its bad debt exposure
each period and records a bad debt provision for accounts receivable it believes it may not collect in full. In the fall of 2024, the
Company completed a project whereby certain older items in accounts receivable for the TinBu subsidiary were offset against the allowance
for uncollectible receivables, resulting in a reduction in the number of individual items in accounts receivable which were aged greater
than 90 days and the total amount for them. At the completion of this project, the balance in the allowance for uncollectible receivables
was $22,016. At the end of 2024 the Company increased the allowance for uncollectible receivables by $10,984. At December 31, 2024