INCOME TAXES |
6 Months Ended |
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Jun. 30, 2026 | |
| Income Tax Disclosure [Abstract] | |
| INCOME TAXES | INCOME TAXES For interim financial reporting, the Company estimates its annual effective tax rate based on the projected income for its entire fiscal year and records a provision or benefit for income taxes on a quarterly basis based on the estimated annual effective income tax rate, adjusted for any discrete tax items. The Company recorded income tax benefit of $36.2 thousand for the three months ended June 30, 2026 compared to zero expense for the three months ended June 30, 2025. Income tax expense for the three months ended June 30, 2026 was favorably impacted by $36.2 thousand of net discrete tax benefit, primarily related to the release of uncertain tax benefits offset by return to provision expense related to income tax returns filed in Canada. Income tax expense for the three months ended June 30, 2025 was entirely attributable to an increase in the valuation allowance of deferred tax assets with no tax expense arising from the estimated annual effective tax rate. The Company recorded income tax benefit of $0.7 million for the six months ended June 30, 2026 compared to zero expense for the six months ended June 30, 2025. Income tax expense for the six months ended June 30, 2026 was favorably impacted by $0.7 million of net discrete tax benefit, primarily related to the release of prior year valuation allowance amounts. The release was driven by the acquisition of net deferred liabilities of Diligent. Income tax expense for the six months ended June 30, 2025 was entirely attributable to an increase in the valuation allowance of deferred tax assets with no tax expense arising from the estimated annual effective tax rate. The Company periodically evaluates its valuation allowance requirements as facts and circumstances change and may adjust its deferred tax asset valuation allowances accordingly. It is reasonably possible that the Company will either add to or reverse a portion of its existing deferred tax asset valuation allowances in the future. Such changes in the deferred tax asset valuation allowances will be reflected in the current operations through the Company’s effective income tax rate. As of June 30, 2026, there have been no material changes in unrecognized tax benefits from those disclosed in the Company’s most recent audited financial statements as of December 31, 2025. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes in its unaudited condensed consolidated statements of operations and comprehensive loss. The Company regularly assesses the likelihood of an adverse outcome resulting from examinations to determine the adequacy of its tax reserves. As of June 30, 2026, the Company believes that it is more likely than not that the tax positions it has taken will be sustained upon the resolution of its audits resulting in no material impact on its consolidated financial position and the results of operations and cash flows. However, the final determination with respect to any tax audits, and any related litigation, could be materially different from the Company’s estimates and/or from its historical income tax provisions and income tax liabilities and could have a material effect on operating results and/or cash flows in the periods for which that determination is made. In addition, future period earnings may be adversely impacted by litigation costs, settlements, penalties, and/or interest assessments related to income tax examinations.
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