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RESTATEMENT | 12 Months Ended
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Dec. 31, 2024
Accounting Changes and Error Corrections [Abstract] |
RESTATEMENT | NOTE 19 – RESTATEMENT During the preparation of the Company’s financial statements for the fiscal year ended December 31, 2025, the Company determined that historical accounting errors existed related primarily to the classification, valuation, and collectability assessment of long-term receivables and contract assets, as well as the timing of revenue recognition and related interest income under U.S. GAAP. In accordance with Staff Accounting Bulletin (“SAB”) 99, Materiality, and SAB 108, Considering the Effects of Prior Period Misstatements when Quantifying Misstatements in Current Period Financial Statements, the Company evaluated the materiality of the errors from qualitative and quantitative perspectives, individually and in aggregate, and concluded that the impact of the errors was material to the Company’s consolidated financial statements as of and for the fiscal years ended December 31, 2024 and 2023. The Company has restated the financial statements for those periods and presented the effects of the restatement adjustments to the financial statements below. The restatement adjustments relate to the following items: (i) the reclassification of certain long-term receivables to contract assets in the amount of $619,779, including adjustments associated with the timing and presentation of revenue recognition under ASC 606, (ii) receivables adjustments, including a write-off of approximately $360,000 and the reclassification of approximately $142,000 to customer deposits, (iii) another receivables write-off of approximately $420,700 related to long-term financing receivables, (iv) a receivables allowance reversal of approximately $95,322, (v) a receivables present value (PV) adjustment of approximately $397,692, together with the recognition of inception-to-date accrued interest income of approximately $130,953, (vi) prior period adjustments whereby approximately $952,000 of the cumulative impact relates to periods prior to January 1, 2023, which are reflected in the restated comparative-period financial statements and related disclosures included herein. Management concluded that separate presentation of an opening January 1, 2023 balance sheet or stockholders’ equity rollforward was not necessary as the effects of such adjustments are appropriately reflected in the accompanying restated financial statements and disclosures and do not materially impact the understanding of the periods presented, and (vii) adjustment of deferred offering costs related to warrants of $127,494 and revaluation of fair value of warrant liabilities entered into in 2024 of $78,148. Certain of the revenue recognition adjustments described above were reflected through the reclassification and valuation of contract assets and long-term receivables and therefore are not separately presented as standalone revenue line-item adjustments within the reconciliation tables below. For the year ended December 31, 2024, the restatement resulted in an increase of $53,153 in accrued interest income associated with long-term financing receivables, the recognition of a $217,584 write-off of long-term financing receivables and a decrease of $26,596 in change in fair value of warrant liability. For the year ended December 31, 2023, the restatement resulted in an increase of $48,595 in accrued interest income associated with long-term financing receivables. SCHEDULE OF RESTATEMENT FOR THE FINANCIAL STATEMENTS The following table presents the effects of the restatement to the accompanying consolidated balance sheet at December 31, 2024:
|  | As Previously Reported |  |  | Restated |  |  | Net Adjustment |
Accounts receivable, net |  | $ | 131,067 |  |  | $ | 8,389 |  |  | $ | (122,678 | )
Deferred offering costs |  |  | 22,750 |  |  |  | 127,494 |  |  |  | 104,744 |
Long-term financing receivables-net |  |  | 1,423,054 |  |  |  | - |  |  |  | (1,423,054 | )
Contract assets |  |  | - |  |  |  | 619,779 |  |  |  | 619,779 |
Total Assets |  |  | 9,505,480 |  |  |  | 8,684,271 |  |  |  | (821,209 | )
Customer Deposits |  |  | 30,061 |  |  |  | 172,061 |  |  |  | 142,000 |
Warrant Liability |  |  | - |  |  |  | 78,148 |  |  |  | 78,148 |
Total Liabilities |  |  | 6,566,978 |  |  |  | 6,787,126 |  |  |  | 220,148 |
Additional paid-in capital |  |  | 30,635,351 |  |  |  | 30,631,493 |  |  |  | (3,858 | )
Accumulated deficit |  |  | (27,443,231 | ) |  |  | (28,480,730 | ) |  |  | (1,037,499 | )
Total stockholders’ Equity |  |  | 2,938,502 |  |  |  | 1,897,145 |  |  |  | (1,041,357 | )
Total Liabilities and stockholders’ Equity |  | $ | 9,505,480 |  |  | $ | 8,684,271 |  |  | $ | (821,209 | )
The following table presents the effects of the restatement to the accompanying consolidated balance sheet at December 31, 2023:
|  | As Previously Reported |  |  | Restated |  |  | Net Adjustment |
Accounts receivable - net |  | $ | 1,102,386 |  |  | $ | 459,008 |  |  | $ | (643,378 | )
Long-term financing receivables - net |  |  | 902,354 |  |  |  | 217,584 |  |  |  | (684,770 | )
Contract assets |  |  | - |  |  |  | 566,626 |  |  |  | 566,626 |
Total Assets |  |  | 10,928,611 |  |  |  | 10,167,089 |  |  |  | (761,522 | )
Customer Deposits |  |  | 165,236 |  |  |  | 307,236 |  |  |  | 142,000 |
Total Liabilities |  |  | 5,059,413 |  |  |  | 5,201,413 |  |  |  | 142,000 |
Accumulated deficit |  |  | (22,984,163 | ) |  |  | (23,887,685 | ) |  |  | (903,522 | )
Total Stockholders’ Equity |  |  | 5,869,198 |  |  |  | 4,965,676 |  |  |  | (903,522 | )
Total Liabilities and Stockholders’ Equity |  | $ | 10,928,611 |  |  | $ | 10,167,089 |  |  | $ | (761,522 | )
The following table presents the effects of the restatement to the accompanying consolidated statement of operations and comprehensive loss for the year ended December 31, 2024:
|  | As Previously Reported |  |  | Restated |  |  | Net Adjustment |
General and Administrative expense |  | $ | 797,518 |  |  | $ | 1,015,102 |  |  | $ | 217,584 |
Net Loss from Operations |  |  | (3,112,847 | ) |  |  | (3,330,431 | ) |  |  | (217,584 | )
Change in FV of warrant liability |  |  | - |  |  |  | 26,596 |  |  |  | 26,596 |
Interest Income |  |  | - |  |  |  | 57,011 |  |  |  | 57,011 |
Net Loss before income taxes |  |  | (4,416,319 | ) |  |  | (4,550,296 | ) |  |  | (133,977 | )
Net loss attributable to Clean Energy Technologies, Inc. |  |  | (4,416,319 | ) |  |  | (4,550,296 | ) |  |  | (133,977 | )
Total Comprehensible Loss |  | $ | (4,476,888 | ) |  | $ | (4,610,865 | ) |  | $ | (133,977 | )
The following table presents the effects of the restatement to the accompanying consolidated statement of operations and comprehensive loss for the year ended December 31, 2023:
|  | As Previously Reported |  |  | Restated |  |  | Net Adjustment |
Interest Income |  | $ | - |  |  | $ | 48,595 |  |  | $ | 48,595 |
Net Loss before income taxes |  |  | (5,782,666 | ) |  |  | (5,734,071 | ) |  |  | 48,595 |
Net loss attributable to Clean Energy Technologies, Inc. |  |  | (5,659,723 | ) |  |  | (5,611,128 | ) |  |  | 48,595 |
Total Comprehensible Loss |  | $ | (5,695,878 | ) |  | $ | (5,647,283 | ) |  | $ | 48,595 |
The following table presents the effects of the restatement ton the accompanying consolidated statement of cash flows for the year ended December 31, 2024:
|  | As Previously Reported |  |  | Restated |  |  | Net Adjustment |
Net loss before discontinued operations |  | $ | (4,416,319 | ) |  | $ | (4,550,296 | ) |  | $ | (133,977 | )
Bad debt expense |  |  | - |  |  |  | 217,584 |  |  |  | 217,584 |
Change in FV of warrant liability |  |  | - |  |  |  | (26,596 | ) |  |  | (26,596 | )
(Increase) decrease in contract asset |  |  | - |  |  |  | (53,153 | ) |  |  | (53,153 | )
Other (Decrease) increase in accrued expenses |  |  | (66,874 | ) |  |  | (70,732 | ) |  |  | (3,858 | )
Net Cash Used in Operating Activities |  | $ | (3,560,951 | ) |  | $ | (3,560,951 | ) |  | $ | - |
The following table presents the effects of the restatement to the accompanying consolidated statement of cash flows for the year ended December 31, 2023:
|  | As Previously Reported |  |  | Restated |  |  | Net Adjustment |
Net loss before discontinued operations |  | $ | (5,659,723 | ) |  | $ | (5,611,128 | ) |  | $ | 48,595 |
(Increase) decrease in contract asset |  |  | - |  |  |  | (48,595 | ) |  |  | (48,595 | )
Net Cash Used in Operating Activities |  | $ | (4,783,077 | ) |  | $ | (4,783,077 | ) |  | $ | - |

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