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Note 18 - Government Assistance
 12 Months Ended
Dec. 31, 2024
Notes to Financial Statements  
Government Assistance [Text Block]

18.

Government Assistance

 

As there is no authoritative guidance under U.S. GAAP on accounting for grants to for profit business entities from government entities, the Company accounts for government assistance by analogy to International Accounting Standards Topic 20, Accounting for Government Grants and Disclosure of Government Assistance (IAS 20). Under IAS 20, government grants are recognized when there is reasonable assurance that the grant will be received and that all conditions related to the grant will be met. Grants related to income are presented as part of the consolidated statements of operations either as a deduction of the related expense or reported separately in other income.  The Company recognizes government assistance that supplements salaries or research activities as a reduction of the related operating expense over the period for which it is intended to compensate. Government assistance that is not directly related to expense reimbursement or relates to costs incurred in a previous fiscal period is recorded as other income.

 

The Coronavirus Aid, Relief, and Economic Security Act of 2020 (“CARES Act”) provided an employee retention tax credit (“ERTC”) that was a refundable tax credit against certain employer taxes. The Company elected to account for the credit as a government grant. The Company received ERTC refunds of $3.2 million during the year ended December 31, 2024. Due to the subjectivity of the credit, the Company has included the refunds received in other current liabilities in the consolidated balance sheet as of December 31, 2024, subject to a determination that the refunds are recognizable. The Company engaged a professional services firm under a commission fee arrangement to assist with determining the Company’s eligibility to claim the ERTC refunds and accumulating the necessary support that was used as a basis in the filing. During the year ended December 31, 2024, the Company paid fees of $0.5 million for these services, which are included in other operating expenses in the consolidated statement of operations. In January 2025, the Company received an additional $1.0 million of ERTC refunds.

 

For the years ended December 31, 2024 and 2023, the Company received $0.5 million and $0.2 million, respectively, under other government assistance programs. The majority of the assistance was a result of the Company’s German subsidiaries participating in programs established to offset the costs of qualifying research and development activities and employee training.