Company: GAME
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023589
Chunk: 95

Company: GameSquare Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 95
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Deferred
tax is provided using the liability method, providing for temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for the following temporary
differences: the initial recognition of goodwill; the initial recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit; and differences relating to investments in subsidiaries, associates,
and jointly controlled entities to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax
provided is based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using tax rates
enacted or substantively enacted at the financial position reporting date applicable to the period of expected realization or settlement.

A
deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the
asset can be utilized.

Deferred
tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities
and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and
liabilities on a net basis.

On
July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law. The OBBBA includes a broad range of tax reform
provisions that may affect the Company’s financial results. The OBBBA has multiple effective dates, with certain provisions effective
in 2025 and others implemented through 2027. The Company is currently evaluating the impact of these provisions which could affect the
Company’s income tax expense and deferred tax assets; however, it is not expected to have a material impact to our unaudited Condensed
Consolidated Financial Statements.

44

Investments

Investments in and advances to entities or joint ventures
in which the Company has significant influence, but less than a controlling financial interest, are accounted for using the equity method.
Significant influence is generally presumed to exist when the Company owns an interest between 20% and 50% and exercises significant influence.

In accordance with ASC 321 “Investments—Equity
Securities” (“ASC 321”), equity securities which the Company has no significant influence (generally less than a 20%
ownership interest) with readily determinable fair values are accounted for at fair value based on quoted market prices. Equity securities
without readily determinable