Company: IPCX
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-111009
Chunk: 28

Company: Inflection Point Acquisition Corp. III
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 28
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 components.
The Company applies this guidance to allocate Initial Public Offering proceeds from the Units between Class A ordinary shares and rights,
using the residual method by allocating Initial Public Offering proceeds first to assigned value of the rights and then to the Class A
ordinary shares. Offering costs allocated to the Class A ordinary shares subject to possible redemption were charged to temporary equity
and offering costs allocated to the rights and Private Placement Units were charged to shareholder’s deficit as the rights and Private
Placement Units, were accounted for under equity treatment based on the equity classification of the underlying financial instruments.

16

INFLECTION POINT ACQUISITION CORP. III

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2025

(Unaudited)

Income Taxes

The Company accounts for income taxes under ASC 740,
“Income Taxes” (“ASC 740”), which prescribes a recognition threshold and measurement process for financial
statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized,
a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest
and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued
for interest and penalties as of September 30, 2025 and December 31, 2024. 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 subject to income tax examinations
by major taxing authorities since inception.

There is currently no taxation imposed on income
by the Government of the Cayman Islands. In accordance with Cayman income tax regulations, income taxes are not levied on the Company.
Consequently, income taxes are not reflected in the Company’s financial statement. The Company’s management does not expect
that the total amount of unrecognized tax benefits will materially change over the next twelve months.

Fair Value of Financial Instruments

The fair value of the Company’s assets and
liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurements and Disclosures,” approximates
the carrying amounts represented in the accompanying balance sheet, primarily due to their short-term nature.

Share Rights

The Company accounted for the Public and Private
Placement Rights issued in connection with the Initial Public Offering and the private placement in accordance with the guidance contained
in FASB ASC Topic 815, “