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Note 3 - Equity Method Investment
 9 Months Ended
Sep. 30, 2024
Notes to Financial Statements  
Equity Method Investments and Joint Ventures Disclosure [Text Block]

(3)

Equity Method Investment

 

In conjunction with the acquisition of AQF, the Company became 50% owners of the equity interest in AQF Asia PTE Ltd., located in Singapore (“AQF Asia”). While the Company owns 50% of the equity interest of AQF Asia and does have significant influence over the entity, the Company has concluded that it does not have control of AQF Asia due to certain “veto rights” held by the “other” joint venture partner with regards to management decision making.

 

As a result, the Company accounts for its ownership interest in AQF Asia following the equity method of accounting, in accordance with ASC 323, Investments —Equity Method and Joint Ventures. Under this method, the carrying cost is initially recorded at fair value and then increased or decreased by recording its percentage of gain or loss in the condensed consolidated statement of comprehensive income and a corresponding change to the carrying value of the asset.

 

The initial fair value of this equity method investment was approximately $5.6 million. The Company’s 50% share of AQF Asia’s net earnings during the third quarter of 2024 was not material.