Company: FLDDW
Filing Date: 2025-01-22
Form Type: S-4/A
Source: 0001213900-25-005202
Chunk: 461

Company: Fold Holdings, Inc.
Filing Date: 2025-01-22
Form: S-4/A
Chunk 461
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 POLICIES (cont.) When the tax law requires interest to be paid on an underpayment of income taxes, the Company recognizes interest expense from the first period the interest would begin accruing according to the relevant tax law. Interest and penalties related to unrecognized tax benefits are recognized within provision for income taxes. We recognize in our financial statements the impact of a tax position, if that position is more likely than not to be sustained upon an examination, based on the technical merits of the position. Recently adopted accounting pronouncements In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016 -13, Financial Instruments — Credit Losses(“ASC 326”). This new standard, as amended, changes how companies account for credit impairment for trade and other receivables as well as changing the measurement of credit losses for most financial assets and certain other instruments (excluding operating leases) that are not measured at fair value through net income. ASC 326 replaced the current “incurred loss” model with an “expected loss” model. Under the “incurred loss” model, a loss (or allowance) is recognized only when an event has occurred (such as a payment delinquency) that causes the entity to believe that a loss is probable (i.e., that it has been “incurred”). Under the “expected loss” model, a loss (or allowance) is recognized upon initial recognition of the asset that reflects all future events that leads to a loss being realized, regardless of whether it is probable that the future event will occur. The “incurred loss” model considers past events and current conditions, while the “expected loss” model includes expectations for the future which have yet to occur. This standard prescribes that financial assets (or a group of financial assets) should be measured at amortized cost basis to be presented at the net amount expected to be collected based on relevant historical information from historical experience, adjusted for current conditions and reasonable and supportable forecasts that affect collectability. Credit losses relating to these financial assets are recorded through an allowance for credit losses. The Company adopted ASC 326, along with its related clarifications and amendments, on January 1, 2023, with no material impact on its financial statements. Results for reporting periods prior to 2023 continue to be presented in accordance with previously applicable U.S. GAAP, while results for subsequent reporting periods are presented under ASC 326. In February 2016, the FASB issued ASU 2016 -02,