DERIVATIVE LIABILITIES

12 Months Ended

Dec. 31, 2024

NOTE 5 – DERIVATIVE LIABILITIES

The Company analyzed the conversion option for derivative accounting consideration under ASC 815, “Derivatives and Hedging,” and determined that the convertible notes should be classified as a liability since the conversion option becomes effective at issuance resulting in there being no explicit limit to the number of shares to be delivered upon settlement of the above conversion options. The Company accounts for convertible notes and warrants as a derivative liability due to there being no explicit limit to the number of shares to be delivered upon settlement of all conversion options.

The following table summarizes the derivative liabilities included in the balance sheet on December 31, 2024:

Fair Value Measurements Using Significant Observable Inputs (Level 3)

Balance - December 31, 2022	$	1,608,485
Net Loss (gain) on change in fair value of the derivative		24,567
Balance - December 31, 2023	$	1,633,052
Net Loss (gain) on change in fair value of the derivative		(495,933	)
Balance - December 31, 2024	$	1,137,119

Authentic Holdings, Inc. 10-K