Quarterly report pursuant to Section 13 or 15(d)

Significant Accounting Policies (Policies)

v3.24.3
Significant Accounting Policies (Policies)
 9 Months Ended
Sep. 30, 2024
Accounting Policies [Abstract]  
Basis of Accounting, Policy [Policy Text Block]

Basis of presentation

 

The accompanying unaudited condensed consolidated financial statements of Aqua Metals, Inc. and subsidiaries (collectively, the “Company” or “Aqua Metals”) have been prepared in accordance with the interim reporting requirements of Form 10-Q, pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) and should be read in conjunction with the Company's audited consolidated financial statements for the period ended December 31, 2023, which are included on Form 10-K filed with the Securities and Exchange Commission on March 28, 2024. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles in the United States of America (“U.S. GAAP”) for annual consolidated financial statements. In the opinion of management, all adjustments (which include normal recurring adjustments) considered necessary to present fairly each of the condensed consolidated balance sheet as of September 30, 2024, the condensed consolidated statements of operations for the three and nine months ended September 30, 2024 and September 30, 2023, the condensed consolidated statements of stockholders' equity for the three and nine months ended September 30, 2024 and September 30, 2023 and the condensed consolidated statements of cash flows for the nine months ended September 30, 2024 and September 30, 2023, as applicable, have been made. The condensed consolidated balance sheet as of December 31, 2023 has been derived from the Company’s audited consolidated financial statements as of such date, but it does not include all disclosures required by U.S. GAAP for annual presentation.

 

The results of operations for the three and nine months ended September 30, 2024 are not necessarily indicative of results that may be expected for the year ending  December 31, 2024.

 
Consolidation, Policy [Policy Text Block]

Principles of consolidation

 

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries, all of which are wholly-owned subsidiaries. Inter-company accounts and transactions have been eliminated in consolidation.

 
Use of Estimates, Policy [Policy Text Block]

Use of estimates

 

The preparation of the condensed consolidated financial statements requires management of the Company to make a number of estimates and assumptions relating to the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements, and the reported amounts of expenses during the period. Significant items subject to such estimates and assumptions include the carrying amount and valuation of long-lived assets, valuation allowances for deferred tax assets, and the determination of stock-based compensation expense. Actual results could differ from those estimates.

 
Earnings Per Share, Policy [Policy Text Block]

Net loss per share

 

Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted average number of common share equivalents outstanding for the period determined using the treasury-stock method or the if-converted method, as applicable. For purposes of this calculation, stock options, restricted stock units (RSUs) and warrants to purchase common stock are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The following shares underlying outstanding convertible notes, stock options, RSUs and warrants to purchase common stock were anti-dilutive due to a net loss in the periods presented and, therefore, were excluded from the dilutive weighted average securities computation for the three and nine months ended September 30, as indicated below:

 

   

Three Months Ended September 30,

    

Nine Months Ended September 30,

  

Excluded potentially dilutive weighted average securities (1):

  

2024

    

2023

    

2024

    

2023

  
                                 

Unvested restricted stock units

     282,016       251,736       340,302       276,271  

Options to purchase common stock

     —       5,790       —       25,299  

Financing warrants to purchase common stock

     1,073,856       21,833       562,639       7,569  

Total potential dilutive weighted average securities

     1,355,872       279,359       902,941       309,139  

 

 

 

(1) Securities are presented on a weighted average outstanding calculation as required if the securities were dilutive and adjusted to give effect to the November 4, 2024 reverse stock split.

 
Segment Reporting, Policy [Policy Text Block]

Segment and geographic information

 

Our chief operating decision maker (“CODM”) is the Chief Executive Officer. Operating segments are defined as components of an enterprise engaging in business activities for which discrete financial information is available and regularly reviewed by the CODM in deciding how to allocate resources and in assessing performance. The CODM views its operations and manages its business in one operating segment.

 
Concentration Risk, Credit Risk, Policy [Policy Text Block]

Concentration of credit risk

 

The Company did not generate revenue during the three and nine months ended September 30, 2024 and 2023, respectively. The Company had no trade receivables as of  September 30, 2024 and  December 31, 2023. The accounts receivable balance on the Company's consolidated balance sheet as of  September 30, 2024 consisted of proceeds from sale of raw materials and proceeds from a non-recurring engineering (NRE) arrangement with 6K Energy. The balance as of  December 31, 2023 consisted of proceeds from a NRE arrangement with 6K Energy.

 
New Accounting Pronouncements, Policy [Policy Text Block]

Recent accounting pronouncements

 

Recently issued accounting pronouncements not yet adopted

 

In  November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2023-07, Improvements to Reportable Segment Disclosures (Topic 280). This ASU updates reportable segment disclosure requirements by requiring disclosures of significant reportable segment expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of a segment's profit or loss. This ASU also requires disclosure of the title and position of the individual identified as the CODM and an explanation of how the CODM uses the reported measures of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources. The ASU is effective for annual periods beginning after  December 15, 2023, and interim periods within fiscal years beginning after  December 15, 2024. Adoption of the ASU should be applied retrospectively to all prior periods presented in the financial statements. Early adoption is also permitted. This ASU will likely result in us including the additional required disclosures when adopted. We are currently evaluating the impact that this guidance will have on the disclosures within our consolidated financial statements.

 

In  December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional information on income taxes paid. The ASU is effective on a prospective basis for annual periods beginning after  December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance. This ASU will require additional disclosures in our consolidated financial statements, once adopted.