v3.26.1
Summary of Significant Accounting Policies (Policies)
 3 Months Ended
Mar. 31, 2026
Accounting Policies [Abstract]  
Principles of Consolidation

Principles of Consolidation

 

The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Legacy Cardio. All intercompany accounts and transactions have been eliminated.

 
Use of Estimates in the Preparation of Financial Statements

Use of Estimates in the Preparation of Financial Statements

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.

 
Segments

Segments

 

The Company uses the “management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker (“CODM”), who is our chief executive officer, for making operating decisions and assessing performance as the source for determining the Company’s reportable segments. Management, including the CODM, reviews operating results solely by monthly revenue and operating results of the Company and, as such, the Company has determined that the Company has one operating segment (product testing) as defined by ASC Topic 280 “Segment Reporting”.

 

One hundred percent of the Company’s revenues are generated from products testing for major types of cardiovascular disease, and therefore the Company has one operating segment for financial reporting purposes. The Company’s principal products are its Epi+Gen CHD and PrecisionCHD tests. Epi+Gen CHD assesses the risk for a coronary heart disease event, including a heart attack, in the next three years. PrecisionCHD aids in diagnosing and managing coronary heart disease. The tests can be paid for by provider organizations, patients, and/or employers. Customers are generally charged for tests utilized or for the minimum committed test volume and the pricing can vary based on organization type, size and volume. 

 

Reportable segment information is presented below:

        
   March 31,   December 31, 
   2026   2025 
Current Segment assets          
    Cash  $7,077,021   $5,110,630 
    Accounts receivable   4,274    8,126 
    Prepaid expenses and other current assets   663,320    801,947 
           
Total current segment assets   7,744,615    5,920,703 
           
Long-term segment assets          
    Property and equipment, net   657,635    700,115 
    Right of use assets, net   214,685    259,565 
    Deposits   12,850    12,850 
    Patent costs, net   929,586    873,182 
           
Total segment assets  $9,559,371   $7,766,415 

 

The accounting policies of the product testing segment are the same as those described in the summary of significant accounting policies.  The measure of segment assets is reported on the balance sheet as total consolidated assets.

 

Reportable segment operating results are presented below:  

         
   Three Months Ended March 31, 
Revenue  2026   2025 
Product Test sales  $2,680   $940 
Total Segment Revenue  $2,680   $940 
           
Segment Operating expenses          
   Payroll and related costs  $353,955    345,497 
   Rent and facility expense   85,557    66,393 
   Legal and professional expense   229,255    301,520 
   Consulting and contractor expense   144,835    160,802 
   Insurance expense   146,354    156,567 
   Filing fees expense   17,250    20,131 
   Transfer agent expense   10,110    6,382 
   Software and web computing expense   90,025    78,591 
   Board compensation expense   49,733    49,612 
   Investor relations expense   38,092    3,750 
   Franchise tax   178,467    225 
   Other segment items (a)   111,864    88,831 
   Research and development expense   129,776    118,784 
   Sales and marketing expense   196,712    188,977 
   Amortization expense   5,532    45,438 
Total Segment Operating Expenses   1,787,517    1,631,500 
   Interest expense, net   3,321    4,504 
Total Segment Net (Loss)  $(1,788,158)  $(1,635,064)

 

(a)   Other segment items included in segment net loss include shipping expense, taxes expense, subscription fees expense, bank fees expense and other overhead expense.

 
Research and Development

Research and Development

 

Research and development costs are expensed as incurred. Research and development costs charged to operations for the three months ended March 31, 2026 and 2025 were $129,776 and $118,784, respectively.

 
Advertising Costs

Advertising Costs

 

The Company expenses advertising costs as incurred. Advertising costs of $18,920 and $41,820 were charged to operations for the three months ended March 31, 2026 and 2025, respectively.

 
Cash and Cash Equivalents

Cash and Cash Equivalents

 

Cash and cash equivalents are comprised of cash and highly liquid investments with original maturities of 90 days or less at the date of purchase. The Company does not have any cash equivalents as of March 31, 2026 and December 31, 2025. Cash is maintained at a major financial institution. Accounts held at U.S. financial institutions are insured by the FDIC up to $250,000. The Company is exposed to credit risk in the event of default by the financial institutions or the issuers of these investments to the extent the amounts on deposit or invested are in excess of amounts that are insured. The Company’s accounts at this major financial institution may, at times, exceed the federally insured limits. The amount in excess of the FDIC insurance as of March 31, 2026 and December 31, 2025, was approximately $6.7 million and $4.8 million, respectively. The Company has not experienced any losses on these accounts and management believes, based upon the quality of this major financial institution, that the credit risk with regard to these deposits is not significant.

 
Reclassification

Reclassification

 

Certain prior period amounts have been reclassified to conform with the current period presentation. On the consolidated statements of operations, prior period amounts of sales and marketing, research and development, and general and administrative under operating expenses have been reclassified to conform with 2026 fiscal year presentation for better reflecting the function of these expenses.

 
Recent Accounting Pronouncements

Recent Accounting Pronouncements

 

Recently adopted accounting pronouncements

 

Income Taxes

 

In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 is intended to improve income tax disclosures primarily through enhanced disclosure of income tax rate reconciliation items, and disaggregation of income (loss) from continuing operations, income tax expense (benefit) and income taxes paid, net disclosures by federal, state and foreign jurisdictions, among others. ASU 2023-09 was effective for annual reporting periods beginning after December 15, 2024. We adopted this ASU on a prospective basis effective January 1, 2025.

 

Recently issued accounting pronouncements not yet adopted

 

Disaggregation of Income Statement Expenses

 

In November 2024, the FASB issued ASU No. 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”, which requires disaggregated disclosure of income statement expenses for public business entities. ASU 2024-03 requires new financial statement disclosures in tabular format, disaggregating information about prescribed categories underlying any relevant income statement expense caption. The prescribed categories include, among other things, purchases of inventory, employee compensation, depreciation, and intangible asset amortization. Additionally, entities must disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and for interim reporting periods within fiscal years beginning after December 15, 2027. The guidance can be applied prospectively with an option for retrospective application. Early adoption is also permitted. We are currently evaluating the provisions of this ASU.

 

Financial Instruments – Measurement of Credit Losses for Accounts Receivable and Contract Assets

 

In July 2025, the FASB issued ASU No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The amendments in this update provide a practical expedient permitting an entity to assume that conditions at the balance sheet date remain unchanged over the life of the asset when estimating expected credit losses for current classified accounts receivable and contract assets. This update is effective for annual periods beginning after December 15, 2025, including interim periods within those fiscal years. Adoption of this ASU can be applied prospectively for reporting periods after its effective date. Early adoption is permitted. The Company is currently evaluating the impact that ASU 2025-05 will have on the consolidated financial statements.

 

We have reviewed other recent accounting pronouncements and concluded they are either not applicable to the business, or no material effect is expected on the consolidated financial statements as a result of future adoption.