SEC Filing Document

Company: Ambitious Entertainment, Inc.
Ticker: 
CIK: 1900851
Filing Type: DRS/A
Document Type: DRS/A
Date Filed: 2025-10-08
Accession Number: 0001493152-25-017387
Exchange: 
SIC Code: 7812
SIC Description: Services-Motion Picture & Video Tape Production
URL: https://www.sec.gov/Archives/edgar/data/1900851/000149315225017387/filename1.htm

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influence over the Company in making financial and operational decisions. Entities are also considered to be related if they are subject to common control or common significant influence. Transactions involving related parties cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive, free market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated. Segment Reporting Under ASC 280, “Segment Reporting,” the Company applies the management approach model to define its operating segments. This model evaluates the manner in which the Company’s chief operating decision maker (“CODM”) organizes the business for decision-making purposes, assessing performance, and allocating resources. Segments are identified based on factors such as products and services, geography, legal structure, or management organization.

The
Company has determined that its operations constitute a single reportable segment. The Company did not produce any films in the six months
ended June 30, 2025. During the six months ended June 30, 2024, the Company produced films in both the United States and Canada, however
management concluded that geographic differences did not result in materially dissimilar economic characteristics. Specifically:

1.	Similar
Economic Characteristics: The production activities in the United States and Canada generate
comparable profit margins, face similar cost structures (e.g., production expenses and tax
incentives), and serve the same class of customers, primarily major studios and streaming
platforms.

2.	Geographic
Operations: While the geographic split has varied (e.g., one film in the U.S. and others
in Canada during 2024), the geographic differences have not created materially different
risks or opportunities for the Company.

Regarding
shared resources, the Company utilizes centralized corporate overhead and administrative services, including executive oversight, financial
management, and compliance monitoring, for all films. Surveillance systems and related infrastructure are also shared across all operations.
However, some differences exist in personnel and equipment usage, as each film may require specific local hires or project-specific equipment.
These differences are operational in nature and do not materially affect the economic characteristics of the Company’s activities.

Based
on these factors, the Company concluded that its films can be aggregated into
a single reportable segment. This decision aligns with the guidance under ASC 280-10-50-11, as the films share similar economic and
operational characteristics, consistent production processes, and a common customer base.

Quantitative
thresholds for identifying additional segments were evaluated, and the Company determined that no individual film or group of films met
the criteria for separate segment reporting. Management will continue to assess its segment reporting annually to ensure compliance with
ASC 280 as the business evolves.

Tax
credits and tax credit receivable

The
Company receives tax incentives from U.S. (state and local) and foreign government agencies to encourage the production of film, episodic
and streaming content. Regarding the accounting treatment for tax credits, GAAP provides limited guidance on the accounting for government
grants received by for-profit companies. In accordance with ASC Topic 832, Government Assistance, as adopted January 1, 2022, we will
disclose certain types of government assistance received in the notes to the unaudited condensed consolidated financial statements that
includes: a) the nature of the transaction including the nature of the assistance being given, b) the accounting policies being used
to account for the transaction and c) other provisions of relevance, where required. Depending on the type of grant or contract, we understand
there is more than one acceptable alternative for the accounting treatment – a reduction of costs, a deferred credit to be amortized,
revenue or other income. The Company has concluded that reimbursements received for tax credits incurred are more akin to a reduction
of capitalized productions costs and applies reimbursements against our content assets. For the six months ended June 30, 2025,
and the year ended December 31, 2024, the company has recorded a tax credit receivable of $0.

Recent
Accounting Pronouncements

Segment
Reporting – Improvements to Reportable Segment Disclosures

November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2023-07, Improvements
to Reportable Segment Disclosures, which expands the disclosure requirements for reportable segments in annual and interim
consolidated financial statements. The guidance requires additional information about significant segment expenses, reconciliations
of segment profit or loss to consolidated income, and the basis of measurement used for segment reporting.

The
standard is effective for public companies for fiscal years beginning after December 15, 2024, and interim periods within
those fiscal years, with early adoption permitted. Accordingly, the Company will adopt ASU 2023-07 beginning with its fiscal year
2025 annual report and interim periods thereafter.

Segment
Information

The
Company currently identifies reportable segments based on the operating segments that are evaluated regularly by the chief operating
decision maker (“CODM”) for purposes of allocating resources and assessing performance. For each reportable segment, the
Company will disclose the following as required under ASU 2023-07:

●	Revenues
from external customers and intersegment revenues.

●	Profit
or loss and total assets for each reportable segment.

●	Reconciliations
of segment profit or loss, assets, and other significant measures to the corresponding amounts
in the consolidated financial statements.

●	Significant
expenses within each segment, including a discussion of material items affecting segment
results.

The
Company is currently evaluating the impact of ASU
2023-07 on its segment disclosures and expects to provide enhanced segment reporting in the fiscal year 2025 filings.

Management
determined the Company’s operations constitute a single reportable segment in accordance with ASC 280.

Income
Taxes – Improvements to Income Tax Disclosures

December 2023, the FASB issued a new standard to improve income tax disclosures. The guidance requires disclosure of disaggregated income
taxes paid, prescribes standardized categories for the components of the effective tax rate reconciliation, and modifies other income
tax-related disclosures. The standard will be effective for us beginning with our annual reporting for fiscal year 2026, with early adoption
permitted. We are currently evaluating the impact of this standard on our income tax disclosures.

Recently
Adopted Accounting Pronouncements

The
Company on January 1, 2022, adopted the provisions of ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and
Derivatives and Hedging – Contracts in Entity’s’ Own Equity (Subtopic 815-40): Accounting for Convertible Instruments
and Contracts in an Entity’s Own Equity). The modified retrospective adoption of the new accounting principle did not have
a material effect on the Company’s financial statements. As a result of the adoption of this new accounting principle, the Company
did not have to separate any embedded conversion feature in the Company’s newly issued convertible debt.

The
Company on January 1, 2022, early adopted ASU 2021-04: Earnings Per Share (Topic 260), Debt – Modifications and Extinguishments
(Subtopic 470-50), Compensation – Stock Compensation (Topic 718) and Derivatives and Hedging – Contracts in Entity’s
Own Equity (Subtopic 815-40) on a prospective basis. The new standard was issued in April 2021 with one aspect being the intent of
standardizing the application of accounting for modification of warrants. The adoption of this ASU did not have material impact on the
Company’s financial statements.

The
Company on January 1, 2022, adopted the provisions of ASU 2021-07,
Determining the Current Price of an Underlying Share for Equity-Classified Share-Based Awards, which provides private companies
the option to elect a practical expedient to determine the current price input of equity-classified share-based awards issued as compensation
using the reasonable application of a reasonable valuation method. The characteristics of this method are the same as the characteristics
used in the regulations of the U.S. Department of the Treasury related to Section 409A of the U.S. Internal Revenue Code (the Treasury
Regulations) to describe the reasonable application of a reasonable valuation method for income tax purposes. The adoption of this ASU
did not have material impact on the Company’s financial statements.

June 2016, the FASB issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic
326), Measurement of Credit Losses on Financial Instruments. ASU No. 2016-13 was further amended in November 2020 by ASU No. 2020-10,
Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842). As a result, ASC
Topic 326, Financial Instruments – Credit Losses is effective for public companies for annual reporting periods, and interim periods
within those years beginning after December 15, 2020. For all other entities, it is effective for fiscal years beginning after December
15, 2022, including interim periods within those fiscal years. As the Company is an “emerging growth company” and elects
to apply for the new and revised accounting standards at the effective date for a private company, the Company adopted ASU No. 2016-13.
on January 1, 2023, and the adoption did not have a material impact on the Company’s unaudited condensed consolidated financial
statements.

NOTE
3 - ACCOUNTS RECEIVABLE

of June 30, 2025, and December 31, 2024, accounts receivable totaled $0 and $290,597, respectively. The amount as
of December 31, 2024, represents funds due to the Company under the terms of the film production service agreements.