Company: TRUE
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001327318-25-000065
Chunk: 168

Company: TrueCar, Inc.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 1
Chunk 168
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 its office leases.Allowance for Doubtful AccountsThe Company determines its allowance for doubtful accounts based on historical write-off experience and specific circumstances that make it likely that recovery will not occur. The Company reviews the allowance for doubtful accounts periodically and assesses the aging of account balances, with an emphasis on those that are past due over ninety days. Account balances are charged off against the allowance when the Company determines that it is probable the receivable will not be recovered. The Company does not have any off-balance sheet credit exposure related to its customers.The Company considers the need to adjust historical information to reflect the extent to which the Company expects current conditions and reasonable and supportable forecasts to differ from the conditions that existed for the period over which historical information was evaluated. The primary current and future economic indicators that the Company uses to develop its current estimate of expected credit losses include the current and forecast U.S. Gross Domestic Product.The Company calculates the expected credit losses on a pool basis for those trade receivables that have similar risk characteristics. For those trade receivables that do not share similar risk characteristics, the allowance for doubtful accounts is calculated on an individual basis. Risk characteristics relevant to the Company’s accounts receivable include revenue billing model and aging status.The following table summarizes the changes in the allowance for doubtful accounts and sales allowances (in thousands): Three Months Ended September 30,Nine Months Ended September 30,2025202420252024Allowances, at beginning of period$759 $860 $783 $1,118 Charged as a reduction of revenue591 621 1,966 1,598 Charged to bad debt expense in general and administrative expenses220 141 457 510 Write-offs, net of recoveries(792)(810)(2,428)(2,414)Allowances, at end of period$778 $812 $778 $812 

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The Company’s assessment considered business and market disruptions impacting its customers and estimates of expected emerging credit and collectability trends. The continued volatility in market conditions and interest rates is difficult to predict, causing variability and volatility that may have a material impact on the Company’s allowance for credit losses in future periods.Recent Accounting PronouncementsIn December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which addresses the requests of investors, lenders, creditors, and other allocators of capital for more