Company: AGSS
Filing Date: 2025-11-17
Form Type: 10-Q
Source: 0001213900-25-111597
Chunk: 37

Company: AMERIGUARD SECURITY SERVICES, INC.
Filing Date: 2025-11-17
Form: 10-Q
Item: Item 8
Chunk 37
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 receivable at net realizable
value. This value includes an appropriate allowance for estimated uncollectible accounts to reflect any loss anticipated on the accounts
receivable balances and is charged to other bad debt expense. We calculate this allowance based on our history of write-offs, the level
of past-due accounts based on the contractual terms of the receivables, and our relationships with, and the economic status of, our customers.
With over eighty-seven percent of year end accounts receivable balance from Federal contracts that require payment, and the uncollectable
amount historically has been less than 1%.
As of September 30, 2025, and December 31, 2024, an allowance for estimated uncollectible accounts was determined to be unnecessary.

Property
and Equipment

 Property and equipment are recorded at cost.
Expenditures for major additions and improvements are capitalized, and minor replacements, maintenance, and repairs are charged to expense
as incurred. When property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are removed from
the accounts and any resulting gain or loss is included in the results of operations for the respective period. Depreciation is provided
over the estimated useful lives of the related assets using the straight-line method for financial statement purposes. The Company uses
other depreciation methods (generally accelerated) for tax purposes where appropriate. The estimated useful life for Machinery and Equipment,
and Vehicles is 5
years, Leased vehicle capital expenditures are depreciated based on lease term generally 4
years, with Leasehold improvements useful life of 15
Years. 

Operating
Leases

In February 2016, FASB ASU No. 2016-02 established
ASC Topic 842, Leases, which sets out the principles for the recognition, measurement, presentation, and disclosure of leases for both
lessees and lessors. Effective December 31, 2022, we have implemented ASU No. 2016-02 and booked the operating lease asset and the
related liability.

 The Company is a lessee with Enterprise Lease
Management for vehicles used in operations, under an all-inclusive master lease. The Company determines if an arrangement is a lease,
or contains a lease, at inception of a contract and when the terms of an existing contract are changed. The Company recognizes a lease
liability and a right-of-use (ROU) asset at the commencement date. The lease liability is initially and subsequently recognized based
on the present value