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INCOME TAXES
 3 Months Ended
Nov. 30, 2025
Income Tax Disclosure [Abstract]  
INCOME TAXES

NOTE 9 – INCOME TAXES

 

The Company accounts for income taxes in interim periods using the estimated annual effective tax rate method. Under this method, the Company estimates its annual effective tax rate for the full fiscal year and applies that rate to its year-to-date pre-tax income or loss and adjusts the provision for (or benefit from) income taxes for discrete items recorded in the period.

 

The Company’s effective tax rate (“ETR”) for the three months ended November 30, 2025 and 2024 was 1.74% and 0%, respectively. The ETR of 1.69% for the three months ended November 30, 2025 was lower than the US statutory rate of 21%, primarily due to the application of a valuation allowance against the Company’s deferred tax assets. As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. Management determined that there is not sufficient positive evidence to conclude that it is more likely than not that Company’s net deferred tax asset will be fully realized. Therefore, the Company recognizes a full valuation allowance as a discrete item for the first three months ended November 30, 2025. The Company will continue to regularly assess the realizability of deferred tax assets.