WRITE-OFF OF PAYABLES

12 Months Ended

Dec. 31, 2023

NOTE H—WRITE-OFF OF PAYABLES

During the 1^st quarter 2023, management has asked legal counsel to render an opinion with respect to the collectability of an outstanding Payable carried on the books since July 2015. Reference: Laws governing the statute of limitations relating to contractual obligations in Nevada are set forth in Title 2, Civil Practice, Chapter 11, of the Nevada Revised Statutes (“NRS”), entitled “Limitations of Actions,” comprising NRS 11.190 through NRS 11.250.

With respect to contractual obligations, under Nevada law, a plaintiff must commence an action permitted at law within the specific time period allotted under Chapter 11 of the NRS. If the action is not brought within the allotted time period, the defendant may assert a defense that the of limitations. The statute of limitations is an affirmative defense in which the defendant introduces evidence, which, if found to be credible, will negate criminal or civil liability, even if it is proven that the defendant committed the alleged acts. The party raising the affirmative defense has the burden of proof on establishing that it applies. In a civil action in which a creditor demands payment on a written instrument evidencing a debt, the successful assertion of the statute of limitations defense will bar collection of the debt. In order to assert the statute of limitations as a defense, a defendant must specifically assert the defense in its answer. If a defendant fails to specifically plead the defense, it will be deemed to be waived. Since no action to enforce such liabilities was brought before December 31, 2022, it is our opinion that the Liability is time-barred from collection under the laws of Nevada and may be removed from the Company’s current balance sheet.

Given the foregoing, the following existing liabilities would be time barred by the statute of limitations:

Nature of Liability	Amount	Date Created	Written Instrument	Maturity Date	Date on which Statute of Limitations Expired
Accounts payable	$7,900.00	July 2015	Engagement Letter	None	July 2021

Therefore, the Company made the decision to write-off the Payable totaling $7,900. As of March 31, 2023, the write-off of the $7,900 resulted in a Gain on Extinguishment of Debt which was reported on the Statement of Operations for the year ended December 31, 2022 —per ASC Section 470-50-40. ASC Section 470-50-40 (Debt Modification and Extinguishments), considers the extinguishment of the debt to an unrelated party results in a Gain on Extinguishment of Debt which has been reported on the Statement of Operations.

Appsoft Technologies, Inc. 10-K