Company: GAME
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001641172-25-023972
Chunk: 32

Company: GameSquare Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 2
Chunk 32
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. Under these national advertising agreements, national advertising revenues are accounted for on a gross
basis with the advertiser identified as the customer and the publisher identified as a supplier, with amounts billed to the advertiser
reported as revenue and amounts due to the publisher reported as a revenue sharing expense, within expenses.

Also
included in advertising revenue is advertising revenue generated by the Company’s various owned and operated properties.

The
Company assesses its revenue arrangements against specific criteria in order to determine if it is acting as principal or agent. When
the Company acts in the capacity of an agent rather than as the principal in a transaction, the revenue recognized is the net amount
of commission made by the Company.

Deferred
revenue consists of customer advances for Company services to be rendered that will be recognized as income in future periods.

Income
taxes

Income
tax on the profit or loss for the periods presented comprises current and deferred tax. Income tax is recognized in profit or loss except
to the extent that it relates to items recognized directly in equity, in which case it is recognized in equity.

Current
tax expense is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at year
end, adjusted for amendments to tax payable with regards to previous years.

Deferred
tax is provided using the liability method, providing for temporary differences between the carrying amounts of assets and liabilities
for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognized for the following temporary
differences: the initial recognition of goodwill; the initial recognition of assets or liabilities in a transaction that is not a business
combination and that affects neither accounting nor taxable profit; and differences relating to investments in subsidiaries, associates,
and jointly controlled entities to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax
provided is based on the expected manner of realization or settlement of the carrying amount of assets and liabilities, using tax rates
enacted or substantively enacted at the financial position reporting date applicable to the period of expected realization or settlement.

A
deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the
asset can be utilized.

Deferred
tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities
and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and
liabilities on a net basis.

On