| Significant Accounting Policies [Text Block] | NOTE 1 Business and Basis of Presentation The condensed consolidated financial statements include the accounts of LiqTech International, Inc., (the “Company”) and its subsidiaries. The terms "Company", “us", "we" and "our" as used in this report refer to the Company and its subsidiaries, which are set forth below in Item 2, These interim consolidated financial statements are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These Condensed Consolidated Financial Statements should be read in conjunction with our financial statements and notes thereto included in our Annual Report on Form 10 December 31, 2023. March 31, 2024 not Consolidation Reverse Stock Split May 26, 2023, 1 1 8 1 8 As a result of the reverse Common Stock split, an amount equal to the decreased value of Common Stock was reclassified from “Common Stock” to “Additional Paid-in Capital.” Functional Currency / Foreign Currency translation three March 31, 2024 2023. Cash and Restricted Cash three March 31, 2024 December 31, 2023, Accounts held in each U.S. institution are insured by the Federal Deposit Insurance Company (“FDIC”) up to $250,000. March 31, 2024 December 31, 2023 Accounts Receivable The roll-forward of the allowance for doubtful accounts for the periods ended March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023 Allowance for doubtful accounts at the beginning of the period $ 134,912 $ 59,559 Bad debt expense 37,717 82,066 Receivables written off during the periods - (10,298 ) Effect of currency translation (3,107 ) 3,585 Allowance for doubtful accounts at the end of the period $ 169,522 $ 134,912 Inventory first first For inventory produced, standard costs that approximate actual costs, applying the FIFO method, are used to value inventory. Standard costs are reviewed at least annually by management or more often in the event that circumstances indicate a change in cost has occurred. Work in process and finished goods include material, labor, and production overhead costs. The Company adjusts the value of its inventory to the extent management determines that the cost cannot be recovered due to obsolescence or other factors. Inventory valuation adjustments for excess and obsolete inventory are calculated based on current inventory levels, movement, expected useful lives, and estimated future demand of the products and spare parts. Contracts Assets / Liabilities not Contract assets also include unbilled receivables, which usually comprise the last invoice remaining after the delivery of the water treatment unit, where revenue is recognized at the transfer of control based upon signed acceptance of the water treatment unit by the customer. Most commonly this invoice is sent to the customer at commissioning of the product or no 12 Leases not 12 not not may Property and Equipment three ten Long-lived Assets may not not Goodwill and Intangible Assets not Acquired intangible assets with determinable useful lives are amortized on a straight-line or accelerated basis over the estimated periods benefited, ranging from one ten five The Company evaluates the recoverability of long-lived assets by comparing the carrying amount of an asset to estimated future net undiscounted cash flows generated by the asset. If such assets are considered to be impaired, the impairment recognized is measured as the amount by which the carrying value of the assets exceeds the fair value of the assets. The evaluation of recoverability involves estimates of future operating cash flows based upon certain forecasted assumptions, including, but not Goodwill is not Revenue Recognition 606, five 1 2 3 4 5 The Company sells products throughout the world, and sales by geographical region are as follows for the three March 31, 2024 2023: For the Three months % Distribution Ended March 31, 2024 2023 2024 2023 Americas 28 % 9 % $ 1,197,197 $ 333,530 Asia-Pacific 8 % 11 % 342,961 451,895 Europe 63 % 77 % 2,650,915 3,099,785 Middle East & Africa 1 % 3 % 44,271 126,309 100 % 100 % $ 4,235,344 $ 4,011,519 The Company’s sales by product line are as follows for the three March 31, 2024 2023: For the Three Months % Distribution Ended March 31, 2024 2023 2024 2023 Water 37 % 36 % $ 1,548,666 $ 1,434,919 Ceramics 42 % 35 % 1,806,336 1,409,372 Plastics 21 % 29 % 880,342 1,167,228 Corporate - % - % - - 100 % 100 % $ 4,235,344 $ 4,011,519 For Water (systems and aftermarket), Ceramics (diesel particulate filters and membranes), and Plastics (components), revenue is recognized when performance obligations specified within the terms of a contract with the customer are satisfied, which occurs when control of the product transfers to the customer or when services are rendered by the Company. The majority of the Company’s sales contracts contain performance obligations satisfied at a point in time when title along with risks and rewards of ownership have transferred to the customer. This generally occurs when the product is shipped or accepted by the customer. Revenue for service contracts is recognized as the services are provided. Revenue is measured as the amount of consideration expected to be received in exchange for transferring the goods or providing services. The satisfaction of performance obligations under the terms of a revenue contract generally gives rise to the right to receive payment from the customer. The Company’s standard payment terms vary by the type and location of the customer and the products or services offered. Generally, the time between when revenue is recognized and when payment is due is not not For contracts with customers that include multiple performance obligations, judgment is required to determine whether performance obligations specified in these contracts are distinct and should be accounted for as separate revenue transactions for recognition purposes. For such arrangements, revenue is allocated to each performance obligation based on its relative standalone selling price. Standalone selling prices are generally determined based on the prices charged to customers or using expected cost-plus margin. System sales are recognized when the Company transfers control to the customer based upon sales and delivery conditions specified in the sales contract. This typically occurs upon shipment of the system from the production facility but can also occur upon other agreed delivery terms. In connection with the completion of the system, it is normal procedure to issue a FAT (Factory Acceptance Test) asserting that the customer has accepted the performance of the system as it is being shipped from our production facility in Hobro, Denmark. As part of the performance obligation, the customer is normally offered commissioning services (final assembly and configuration at a place designated by the customer), and this commissioning is therefore considered a second second first Aftermarket sales represent parts, extended warranties, and maintenance services. For the sale of aftermarket parts, the Company transfers control and recognizes revenue when parts are shipped to the customer. When customers are given the right to return eligible parts and accessories, the Company estimates the expected returns based on an analysis of historical experience. The Company adjusts estimated revenues at the earlier of when the most likely amount of consideration expected to be received changes or when the consideration becomes fixed. The Company recognizes revenue for extended warranty and maintenance agreements based on the standalone selling price over the life of the contract. The Company has received long-term contracts for grants from government entities for the development and use of silicon carbide membranes in various water filtration and treatment applications and historically in the installation of various water filtration systems. We measure the transfer of control of the performance obligation on long-term contracts utilizing the cost-to-cost measure of progress, with cost of revenue including direct costs such as labor and materials. Under the cost-to-cost approach, the use of estimated costs to complete each performance obligation is a significant variable in the process of determining recognized revenue and a significant factor in the accounting for such performance obligations. The timing of when we bill our customers is generally dependent upon advance billings terms, milestone billings based on completion of certain phases of the work, or when services are provided or products are shipped. Projects with performance obligations recognized over time that have costs and estimated earnings recognized to date in excess of cumulative billings are reported on our balance sheet as Contract assets. Projects with performance obligations recognized over time that have cumulative billings in excess of costs and estimated earnings recognized to date are reported on our balance sheet as Contract liabilities. The roll-forward of Contract assets / liabilities for the periods ended March 31, 2024 December 31, 2023 March 31, 2024 December 31, 2023 Cost incurred $ 3,492,545 $ 3,225,728 Unbilled project deliveries 547,047 582,557 VAT 184,150 329,980 Other receivables 173,945 92,619 Prepayments (2,026,550 ) (1,688,427 ) Deferred Revenue (76,137 ) (33,360 ) $ 2,295,000 $ 2,509,097 Distributed as follows: Contract assets $ 2,848,985 $ 2,891,744 Contract liabilities (553,985 ) (382,647 ) $ 2,295,000 $ 2,509,097 Advertising Cost three March 31, 2024 2023 Research and Development Cost three March 31, 2024 2023 Income Taxes 740, Income/(Loss) Per Share 260, not Stock Awards 718, Fair Value of Financial Instruments 820. three ● Level 1. ● Level 2. ● Level 3. no Unless otherwise disclosed, the fair value of the Company’s financial instruments including cash, accounts receivable, other receivables, prepaid expenses, accounts payable, accrued expenses, and senior promissory notes payable approximate their recorded values due to their short-term maturities. Accounting Estimates Recent Accounting Pronouncements R not not |
