Company: TRUE
Filing Date: 2025-02-21
Form Type: 10-K/A
Source: 0001327318-25-000010
Chunk: 23

Company: TrueCar, Inc.
Filing Date: 2025-02-21
Form: 10-K/A
Chunk 23
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 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 (“GDP”).

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):

|                                                                    |     | Year Ended December 31, |   2024 |     |   |   2023 |     |   |   2022 |
|:-------------------------------------------------------------------|:----|:------------------------|-------:|:----|:--|-------:|:----|:--|-------:|
| Allowances, at beginning of year                                   |     | $                       |  1,118 |     | $ |  1,073 |     | $ |  3,099 |
| Charged as a reduction of revenue                                  |     |                         |  2,179 |     |   |  2,569 |     |   |  2,661 |
| Charged to bad debt expense in general and administrative expenses |     |                         |    574 |     |   |    696 |     |   |    718 |
| Write-offs, net of recoveries                                      |     |                         | -3,088 |     |   | -3,220 |     |   | -5,405 |
| Allowances, at end of year                                         |     | $                       |    783 |     | $ |  1,118 |     | $ |  1,073 |

Property and Equipment, net

Property and equipment are stated at cost, less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, which is generally three yearsfor computer hardware and software, five yearsfor furniture and equipment, and over the shorter of the lease term or the useful life of the