Company: EMCRF
Filing Date: 2025-12-10
Form Type: 10-Q
Source: 0001493152-25-027065
Chunk: 21

Company: Embrace Change Acquisition Corp.
Filing Date: 2025-12-10
Form: 10-Q
Item: Part I, Item 1
Chunk 21
---
 accrued interest and penalties related to unrecognized tax benefits, if any, as income
tax expense. There were no unrecognized tax benefits as of September 30, 2025 and December 31, 2024 and no amounts accrued for interest
and penalties. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material
deviation from its position.

The
Company is considered to be an exempted Cayman Islands company with no connection to any other taxable jurisdiction and is presently
not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As such, the Company’s
tax provision was zero from inception to September 30, 2025.

Segment
Reporting

ASC
Topic 280, “Segment Reporting,” establishes standards for companies to report in their financial statement information about
operating segments, products, services, geographic areas, and major customers. Operating segments are defined as components of an enterprise
for which separate financial information is available that is regularly evaluated by the Company’s chief operating decision maker,
or group, in deciding how to allocate resources and assess performance.

    12

The
Company’s chief operating decision maker has been identified as the Chief Executive Officer (“CODM”), who reviews the
operating results for the Company as a whole to make decisions about allocating resources and assessing financial performance. Accordingly,
management has determined that the Company only has one operating segment.

When
evaluating the Company’s performance and making key decisions regarding resource allocation, the CODM reviews key metrics, formation
and operational costs and interest earned on cash and investments held in Trust Account which are included in the accompanying statements
of operations.

The
key measures of segment profit or loss reviewed by the Company’s CODM are interest earned on cash and investments held in Trust
Account and formation and operational costs. The CODM reviews interest earned on cash and investments held in Trust Account to measure
and monitor stockholder value and determine the most effective strategy of investment with the Trust Account funds while maintaining
compliance with the trust agreement. Formation and operational costs are reviewed and monitored by the CODM to manage and forecast cash
to ensure enough capital is available to complete a business combination within the business combination period. The CODM also reviews
formation and operational costs to manage, maintain and enforce all contractual agreements to ensure costs are aligned with all agreements
and budget.

Recent
Accounting Pronouncements

Management
does not believe that any recently issued, but not yet