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INTANGIBLE ASSETS
 3 Months Ended
Mar. 31, 2025
Goodwill and Intangible Assets Disclosure [Abstract]  
INTANGIBLE ASSETS

NOTE 6 – INTANGIBLE ASSETS

 

Intangible assets were comprised of the following at:

 

    March 31, 2025     December 31, 2024  
Goodwill   $ 747,976       747,976  
LWL Intangibles     1,468,709       1,468,709  
License     354,322       354,322  
Patents     190,789       190,789  
Accumulated Amortization     (110,848 )     (107,879 )
Net Intangible Assets   $ 2,650,948       2,653,917  

 

Our Amortization Expense for the three months ended March 31, 2025 and 2024 was $2,969 and 2,969 respectively.

 

 

As of both March 31, 2025, and December 31, 2024, goodwill amounted to $747,976. The Company classifies goodwill as having an indefinite life, and as such, it is not amortized but is subject to annual impairment testing. The Company evaluates goodwill for impairment at least annually, or more frequently if events or changes in circumstances indicate that the asset might be impaired. The useful life of goodwill is considered indefinite due to the continued potential to generate economic benefits from the business acquired. The Company conducts impairment testing based on projected future cash flows of the acquired business and other relevant factors.

 

The LWL Investment balance of $1,468,709 as of both December 31, 2024, and December 31, 2023, is classified as having an indefinite life. This classification is based on the nature of the investment, which is expected to provide continued economic benefits without a foreseeable end date. The Company conducts an annual review to assess whether this classification remains appropriate, including evaluating the investment’s ability to generate cash flows and the continued support of the investment’s carrying value.

 

The License balance remained unchanged at $354,322 for both 2024 and 2023. The License is considered to have a finite life, and as such, it is subject to amortization over its estimated useful life. The Company estimates the useful life of the License based on the legal term and any other relevant factors, such as the expected technological obsolescence or the duration of the agreement. The amortization of this asset is reflected in the Company’s financial statements.

 

The Patents balance, after amortization, was $79,941 as of March 31, 2025, and $82,910 as of December 31, 2024. Patents are classified as having a finite life and are amortized over their expected useful life, typically based on the legal protection period, which is generally 20 years from the filing date, or the expected period of the patent’s utility. The Company evaluates the carrying value of patents regularly to ensure that their estimated useful life and amortization period remain appropriate. Amortization expense for the period pertains to the systematic allocation of the cost of patents over their estimated useful lives.

 

Based on the foregoing analysis of the facts surrounding the Company’s acquisition of LWL, it is the Company’s position that the Company is the acquirer of LWL, under the acquisition method of accounting.

 

As such, as of November 8, 2021 (the acquisition date), the Company recognized, separately from goodwill, the identifiable assets acquired and the liabilities assumed in the Business combination.

 

The following table presents the purchase price allocation:

 

Consideration:     
Cash and cash equivalents  $1,500,000 
      
Total purchaser consideration  $1,500,000 
      
Assets acquired:     
Cash and cash equivalents  $6,156 
Prepayment  $13,496 
Other receivable  $20,000 
Trading Contracts  $146,035 
Shenzhen Gas Relationship  $1,314,313 
Total assets acquired  $1,508,539 
      
Liabilities assumed:     
Advance Receipts  $(8539 
Taxes Payable  $179 
Net Assets Acquired:  $1,500,000 

 

If LWL had reached USD 5 million in revenue or net profit of USD 1 million by December 31, 2023, then based on the performance contingency there will be issuance of 500,000 shares of CETY to the Seller. The performance contingencies were not met. Since the performance metrics were clearly defined and objectively not met, the contingency is considered extinguished and no accrual is warranted.