Company: NTWK
Filing Date: 2025-05-14
Form Type: 10-Q
Source: 0001641172-25-010127
Chunk: 87

Company: NETSOL TECHNOLOGIES INC
Filing Date: 2025-05-14
Form: 10-Q
Item: Part I, Item 8
Chunk 87
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of derivatives. The effects of interactions between embedded derivatives are calculated and accounted for in arriving at the overall
fair value of the financial instruments. In addition, the fair values of freestanding derivative instruments such as warrants and option
derivatives are valued using the Black-Scholes model.

Recent
Accounting Standards:

In
November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07,
Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 expands public entities’ segment
disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker
and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items,
and interim disclosures of a reportable segment’s profit or loss and assets. ASU 2023-07 is effective for the Company’s Annual
Report on Form 10-K for the fiscal year ending June 30, 2025, and subsequent interim periods, with early adoption permitted. We are evaluating
the impact of adopting this ASU on our consolidated financial statements and related disclosures.

    Page 13

NETSOL
                                            TECHNOLOGIES, INC.

Notes
to Condensed Consolidated Financial Statements

March
31, 2025

(Unaudited)

In
December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, to enhance transparency
and decision usefulness of income tax disclosures, particularly around rate reconciliations and income taxes paid information. ASU 2023-09
is effective for our Annual Report on Form 10-K for the fiscal year ending June 30, 2026, on a prospective basis, with early adoption
permitted. We are evaluating the impact of adopting this ASU on our consolidated financial statements and related disclosures.

All
other newly issued accounting pronouncements not yet effective have been deemed either immaterial or not applicable.

NOTE
3 – REVENUE RECOGNITION

The
Company determines revenue recognition through the following steps:

●Identification
                                            of the contract, or contracts, with a customer;

●Identification
                                            of the performance obligations in the contract;

●Determination
                                            of the transaction price;

●Allocation
                                            of the transaction price to the performance obligations in the contract; and

●Recognition
                                            of revenue