Company: MIRA
Filing Date: 2025-03-28
Form Type: 10-K
Source: 0001641172-25-001183
Chunk: 608

Company: MIRA PHARMACEUTICALS, INC.
Filing Date: 2025-03-28
Form: 10-K
Item: Item 5
Chunk 608
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 balances at two financial institutions that are insured by the
Federal Deposit Insurance Corporation (“FDIC”). The Company’s account at these institutions are insured by the FDIC
up to $250,000.
On December 31, 2024, the Company had cash in excess of FDIC limits of approximately $2.3
million. To reduce its risk associated with the
failure of such financial institution, the Company evaluates at least annually the rating of the financial institution in which it holds
deposits.

Stock-based
compensation

The
Company accounts for stock-based compensation under the provisions of FASB ASC 718, “Compensation - Stock Compensation”,
which requires the measurement and recognition of compensation expense for all stock-based awards made to employees, directors and consultants
based on estimated fair values on the grant date. The Company estimates the fair value of stock-based awards on the date of grant using
the Black-Scholes model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the
requisite service periods using the straight-line method. The Company has elected to account for forfeiture of stock-based awards as
they occur.

    F-10

MIRA
                                            PHARMACEUTICALS, INC.

NOTES
TO THE FINANCIAL STATEMENTS

DECEMBER
31, 2024 AND 2023

Operating Segments

Operating segments are identified as components of an enterprise for which separate discrete financial information
is available for evaluation by the Company’s chief operating decision maker (“CODM”) and relied upon when making decisions
regarding resource allocation and assessing performance.  When evaluating the Company’s financial performance, the CODM reviews
total revenues, total expenses, and expenses by functional classification;  using this information to make decisions on a company-wide
basis.

Fair
value of financial instruments

The
Company measures the fair value of financial instruments in accordance with GAAP which defines fair value, establishes a framework for
measuring fair value, and expands disclosures about fair value measurements.

GAAP
defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal
or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
GAAP also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use
of unobservable inputs when measuring fair value. The Company considers the carrying amount