Company: DGLY
Filing Date: 2025-05-02
Form Type: 424B3
Source: 0001641172-25-008437
Chunk: 105

Company: DIGITAL ALLY, INC.
Filing Date: 2025-05-02
Form: 424B3
Chunk 105
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 | Recognized Revenue |     |   | December 31, 2023 |
|:----------------------------------|:----|:------------------|------------------:|:----|:--|------------------:|:----|:--|-------------------:|:----|:--|------------------:|
| Contract liabilities, current     |     | $                 |         2,154,874 |     | $ |         2,538,187 |     | $ |          1,755,893 |     | $ |         2,937,168 |
| Contract liabilities, non-current |     |                   |         5,818,082 |     |   |         2,328,994 |     |   |            806,617 |     |   |         7,340,459 |
|                                   |     | $                 |         7,972,956 |     | $ |         4,867,181 |     | $ |          2,562,510 |     | $ |        10,277,627 |

Sales returns and allowances aggregated $86,370 and $117,713 for the years ended December 31, 2024 and 2023, respectively. Obligations for estimated sales returns and allowances are recognized at the time of sales on an accrual basis. The accrual is determined based upon historical return rates adjusted for known changes in key variables affecting these return rates.

Use of Estimates:

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates. Management utilizes various other estimates, including but not limited to, determining the estimated lives of long-lived assets, determining the potential impairment of long-lived assets, the fair value of warrants, options, the recognition of revenue, inventory valuation reserve, allowances for doubtful accounts and other receivables, incremental borrowing rate on leases, the valuation allowance for deferred tax assets and other legal claims and contingencies. The results of any changes in accounting estimates are reflected in the financial statements in the period in which the changes become evident. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the period that they are determined to be necessary.

| F-11 |

Cash and cash equivalents: