| Summary of Significant Accounting Policies | Note 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements and related notes, prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), include the accounts of Sunlight and its consolidated subsidiaries. In the opinion of management, all adjustments considered necessary for a fair presentation of Sunlight’s financial position, results of operations and cash flows have been included and are of a normal and recurring nature. All intercompany balances and transactions have been eliminated. Certain prior period amounts have been reclassified to conform to the current period’s presentation. Emerging Growth Company Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Securities Exchange Act of 1934, as amended) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s consolidated financial statements with another public company that is neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Consolidation The analysis as to whether to consolidate an entity is subject to a significant amount of judgment. Some of the criteria considered are the determination as to the degree of control over an entity by its various equity holders, the design of the entity, how closely related the entity is to each of its equity holders, the relation of the equity holders to each other and a determination of the primary beneficiary in entities in which Sunlight has a variable interest. These analyses involve estimates, based on the assumptions of management, as well as judgments regarding significance and the design of entities. VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. A VIE is required to be consolidated by its primary beneficiary, and only by its primary beneficiary, which is defined as the party who has the power to direct the activities of a VIE that most significantly impact its economic performance and who has the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. Sunlight monitors investments in VIEs and analyzes the potential need to consolidate the related entities pursuant to the VIE consolidation requirements. These analyses require considerable judgment in determining whether an entity is a VIE and determining the primary beneficiary of a VIE since they involve subjective determinations of significance, with respect to both power and economics. The result could be the consolidation of an entity that otherwise would not have been consolidated or the deconsolidation of an entity that otherwise would have been consolidated. As a result of the Business Combination, a wholly-owned subsidiary of Sunlight Financial Holdings Inc. is the managing member of Sunlight Financial LLC, in which existing unitholders hold a 35.0% noncontrolling interest at December 31, 2021, net of unvested Class EX Units (Note 6). Through its indirect managing member interest, Sunlight Financial Holdings Inc. directs substantially all of the day-to-day activities of Sunlight Financial LLC. The third-party investors in Sunlight Financial LLC do not possess substantive participating rights or the power to direct the day-to-day activities that most directly affect the operations of Sunlight Financial LLC. However, these third-party investors hold both voting, noneconomic Class C shares in Sunlight Financial Holdings Inc. on a one-for-one basis along with nonvoting, economic Class EX Units issued by Sunlight Financial LLC. No single third-party investor, or group of third-party investors, possesses the substantive ability to remove the managing member of Sunlight Financial LLC. Sunlight considers Sunlight Financial LLC a VIE for consolidation purposes and its managing members holds the controlling interest and is the primary beneficiary. Therefore, Sunlight consolidates Sunlight Financial LLC and reflects Class EX unitholder interests in Sunlight Financial LLC held by third parties as noncontrolling interests. Sunlight conducts substantially all operations through Sunlight Financial LLC and its consolidated subsidiary. Segments Risks and Uncertainties Use of Estimates Fair Value Level Measurement 1 Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. 2 Inputs are other than quoted prices that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar instruments in active markets, and inputs other than quoted prices that are observable for the asset or liability. 3 Inputs are unobservable for the asset or liability, and include situations where there is little, if any, market activity for the asset or liability. Sunlight follows this hierarchy for its financial instruments, with classifications based on the lowest level of input that is significant to the fair value measurement. The following summarizes Sunlight’s financial instruments hierarchy at December 31, 2021: Level Financial Instrument Measurement 1 Cash and cash equivalents and restricted cash Estimates of fair value are measured using observable, quoted market prices, or Level 1 inputs Public Warrants Estimates of fair value are measured using observable, quoted market prices of Sunlight’s warrants. 3 Loans and loan participations, held-for-investment Estimated fair value is generally determined by discounting the expected future cash flows using inputs such as discount rates. Contract derivative Estimated fair value based upon discounted expected future cash flows arising from the contract. Private Placement Warrants Estimated fair value based upon quarterly valuation estimates of warrant instruments, based upon quoted prices of Sunlight’s Class A shares and warrants thereon as well as fair value inputs provided by an independent valuation firm. Valuation Process may incorporate assumptions that are management’s best estimates after consideration of a variety of internal and external factors. When an independent valuation firm expresses an opinion on the fair value of a financial instrument in the form of a range, management selects a value within the range provided by the independent valuation firm to assess the reasonableness of management’s estimated fair value for that financial instrument. At December 31, 2021, Sunlight’s valuation process for Level 3 measurements, as described below, were conducted internally or by an independent valuation firm and reviewed by management. Valuation of Loans and Loan Participations Valuation of Contract Derivative Valuation of Warrants Other Valuation Matters See Note 7 for additional information regarding the valuation of Sunlight’s financial assets and liabilities. Sales of Financial Assets and Financing Agreements Balance Sheet Measurement Cash and Cash Equivalents and Restricted Cash Successor Predecessor December 31, December 31, 2021 2020 Cash and cash equivalents $ 91,882 $ 49,583 Restricted cash and cash equivalents 2,018 3,122 Total cash, cash equivalents, and restricted cash shown in the Consolidated Statement of Cash Flows $ 93,900 $ 52,705 Financing Receivables Advances Loans and Loan Participations Impairment The evaluation of these indicators of impairment requires significant judgment by management to determine whether failure to collect contractual amounts is probable as well as in estimating the resulting loss allowance. While management uses the best information available to make its evaluation, future adjustments to the allowance may be necessary if there are significant changes in economic conditions. These evaluations are inherently subjective, as they require material estimates and may be susceptible to significant change. Actual losses, if any, could materially differ from these estimates. If management deems that it is probable that Sunlight will be unable to collect all amounts owed according to the contractual terms of a receivable, impairment of that receivable is indicated. Consistent with this definition, all receivables for which the accrual of interest has been discontinued (nonaccrual loans) are considered impaired. If management considers a receivable to be impaired, management establishes an allowance for losses through a valuation provision in earnings, which reduces the carrying value of the receivable to (a) the amounts management expect to collect, for receivables due within 90 days, or (b) the present value of expected future cash flows discounted at the receivable’s contractual effective rate. Impaired financing receivables are charged off against the allowance for losses when a financing receivable is more than 120 days past due or when management believes that collectability of the principal is remote, if earlier. Sunlight credits subsequent recoveries, if any, to the allowance when received. At December 31, 2021 and December 31, 2020, Sunlight evaluated financing receivables collectively, based upon those financing receivables with similar characteristics. Sunlight individually evaluates nonaccrual loans with contractual balances of $50,000 or more and receivables whose terms have been modified in a troubled debt restructuring with contractual balances of $50,000 or more to establish specific allowances for such receivables, if required. Those financing receivables where impairment is indicated were evaluated individually for impairment, though such amounts were not material. Advances 1 Low The counterparty has demonstrated low risk characteristics. The counterparty is a well-established company within the applicable industry, with low commercial credit risk, excellent reputational risk (e.g. online ratings, low complaint levels), and an excellent financial risk assessment. 2 Low-to- The counterparty has demonstrated low to medium risk characteristics. The counterparty is a well-established company within the applicable industry, with low to medium commercial credit risk, excellent to above average reputational risk (e.g. online ratings, lower complaint levels), and/or an excellent to above average financial risk assessment. 3 Medium The counterparty has demonstrated medium risk characteristics. The counterparty may be a less established company within the applicable industry than risk tier “1” or “2”, with medium commercial credit risk, excellent to average reputational risk (e.g., online ratings, average complaint levels), and/or an excellent to average financial risk assessment. 4 Medium- The counterparty has demonstrated medium to high risk characteristics. The counterparty is likely to be a less established company within the applicable industry than risk tiers “1” through “3,” with medium to high commercial credit risk, excellent to below average reputational risk (e.g. online ratings, higher complaint levels), and/or an excellent to below average financial risk assessment. 5 Higher The counterparty has demonstrated higher risk characteristics. The counterparty is a less established company within the applicable industry, with higher commercial credit risk, and/or below average reputational risk (e.g. online ratings, higher complaint levels), and/or below average financial risk assessment. Tier “5” advance approvals will be approved on an exception basis. Loans and Loan Participations, Held-For-Investment Goodwill July 9, 2021 (Successor) Goodwill $ 670,014 Accumulated impairment losses — 670,014 Impairment losses (224,701) Other (a) 443 December 31, 2021 (Successor) Goodwill 670,457 Accumulated impairment losses (224,701) $ 445,756 (a) Reflects purchase price adjustments related to deferred tax liabilities created at the Closing Date of the Business Combination. Intangible Assets, Net Estimated Useful Life Carrying Value (in Years) Successor Predecessor December 31, December 31, Asset Successor Predecessor 2021 2020 Contractor relationships (a) 11.5 n.a. $ 350,000 $ — Capital provider relationships (b) 0.8 n.a. 43,000 — Trademarks/ trade names (c) 10.0 n.a. 7,900 — Developed technology (d) 3.0 — 5.0 1.0 — 3.0 8,193 11,775 409,093 11,775 Accumulated amortization (e)(f)(g) (43,254) (7,242) $ 365,839 $ 4,533 (a) Represents the value of existing contractor relationships of Sunlight estimated using a multi-period excess earnings methodology. (b) Represents the value of existing relationships with the banks that may be estimated by applying a with-and-without methodology. (c) Represents the trade names that Sunlight originated or acquired and valued using a relief-from-royalty method. (d) Represents technology developed by Sunlight for the purpose of generating income for Sunlight, and valued using a replacement cost method. (e) Amounts include $ 8.2 million and $ 11.8 million of capitalized internally developed software costs at December 31, 2021 and December 31, 2020, respectively. (f) Includes amortization expense of $ 43.3 million for the period July 10, 2021 through December 31, 2021, $ 1.4 million, for the period January 1, 2021 through July 9, 2021, and $ 2.9 million for the year ended December 31, 2020, respectively. (g) At December 31, 2021, the approximate aggregate annual amortization expense for definite-lived intangible assets, including capitalized internally developed software costs as a component of capitalized developed technology are as follows: Developed Other Identified Technology Intangible Assets Total 2022 $ 1,838 $ 46,648 $ 48,486 2023 1,838 31,199 33,037 2024 1,739 31,285 33,024 2025 1,340 31,199 32,539 2026 694 31,199 31,893 Thereafter — 186,860 186,860 $ 7,449 $ 358,390 $ 365,839 Property and Equipment, Net Estimated Useful Life Carrying Value (in Years) Successor Predecessor December 31, December 31, Asset Category Successor Predecessor 2021 2020 Furniture, fixtures, and equipment 5 7 $ 1,020 $ 555 Computer hardware 5 5 1,108 868 Computer software 1—3 1—3 250 197 Leasehold improvements Shorter of life of improvement or lease term 2,829 421 5,207 2,041 Accumulated amortization and depreciation (a) (1,138) (849) $ 4,069 $ 1,192 (a) Includes depreciation expense of $ 0.2 million for the period July 10, 2021 through December 31, 2021, $ 0.2 million, for the period January 1, 2021 through July 9, 2021, and $ 0.3 million for the year ended December 31, 2020, respectively. Funding Commitments Guarantees Warrants The Company classifies as assets or liabilities any equity-linked contracts that (1) require net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside the Company’s control) or (2) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement or net-share settlement). For equity-linked contracts that are classified as liabilities, the Company records the fair value of the equity-linked contracts at each balance sheet date and records the change in the statements of operations as a gain (loss) from change in fair value of warrant liability. The Company’s public warrant liability is valued using observable market prices for those public warrants. The Company’s private placement warrants are valued using a binomial lattice pricing model when the warrants are subject to the make-whole table, or otherwise are valued using a Black-Scholes pricing model. The Company’s warrants issued to a capital provider are valued using a Black-Scholes pricing model based on observable market prices for public shares and warrants. The assumptions used in preparing these models include estimates such as volatility, contractual terms, discount rates, dividend yield, expiration dates and risk-free rates. Distributions Payable Other Assets and Accounts Payable, Accrued Expenses, and Other Liabilities Noncontrolling Interests in Consolidated Subsidiaries Class EX Units issued by Sunlight Financial LLC are exchangeable into the Company’s Class A common stock. Class A common stock issued upon exchange of a holder’s noncontrolling interest is accounted for at the carrying value of the surrendered limited partnership interest and the difference between the carrying value and the fair value of the Class A common stock issued is recorded to additional paid-in-capital. Treasury Stock Income Recognition Revenue Recognition Successor Predecessor For the Period For the Period For the Year July 10, 2021 January 1, Ended to December 2021 to July 9, December 31, 31, 2021 2021 2020 Platform fees, net (a) $ 56,783 $ 50,757 $ 66,853 Other revenues (b) 4,891 2,307 2,711 $ 61,674 $ 53,064 $ 69,564 (a) Amounts presented net of variable consideration in the form of rebates to certain contractors. Includes platform fees from affiliates of $ 0.2 million and $ 0.3 million for the period January 1, 2021 through July 9, 2021, and the year ended December 31, 2020, respectively. (Note 9). (b) Includes loan portfolio management, administration, and other ancillary fees Sunlight earns that are incidental to its primary operations. Sunlight earned $ 0.1 million for the period July 10, 2021 through December 31, 2021, $ 0.1 million for the period January 1, 2021 through July 9, 2021, and $ 0.2 million for the year ended December 31, 2020, respectively, in administrative fees from an affiliate. (Note 9). Platform Fees, Net The contracts under which Sunlight (a) arranges Indirect Channel Loans for the purchase and installation of home improvements other than residential solar energy systems and (b) earns income from the prepayment of certain of those Indirect Channel Loans sold to an Indirect Channel Loan Purchaser are considered derivatives under GAAP. As such, Sunlight’s revenues exclude the platform fees that Sunlight earns in connection with these contracts. Instead, Sunlight records realized gains on the derivatives within “Realized Gains on Contract Derivative, Net” in the accompanying Consolidated Statements of Operations. Sunlight realized gains of $2.9 million and $3.0 million for the periods July 10, 2021 through December 31, 2021 and January 1, 2021 through July 9, 2021 and $0.1 million for the year ended December 31, 2020, respectively, in connection with these contracts (Note 4). However, Sunlight recognized platform fee revenue of $0.2 million for its facilitation of direct channel home improvement loans. Other Revenues Interest Income Loans are considered past due or delinquent if the required principal and interest payments have not been received as of the date such payments are due. Generally, loans, including impaired loans, are placed on non-accrual status when (i) either principal or interest payments are 90 days or more past due based on contractual terms or (ii) an individual analysis of a borrower’s creditworthiness indicates a loan should be placed on non-accrual status. When a loan owned by Sunlight (each, a “Balance Sheet Loan”) is placed on non-accrual status, Sunlight ceases to recognize interest income on the loans and reverses previously accrued and unpaid interest, if any. Subsequent receipts on non-accrual loans are recorded as a reduction of principal, and interest income may only be recorded on a cash basis after recovery of principal is reasonably assured. Sunlight may return a loan to accrual status when repayment of principal and interest is reasonably assured under the terms of the restructured loan. Advances are created at par and do not bear, and therefore do not accrue, interest income. Expense Recognition Cost of Revenues Sunlight Rewards™ Program Compensation and Benefits Equity-Based Compensation Predecessor ● Time-Based Service — Sunlight Financial LLC expensed awards that only requires time-based service conditions ratably over the required service period, or immediately if there was no required service period. ● PIK Vesting Requirement — Sunlight Financial LLC awarded equity-based compensation in the form of anti-dilution units. Such awards vested in an amount generally proportionate to the dilution of related Class C Units or LTIP Units that resulted from the issuance of additional Class A Units. Sunlight Financial LLC expensed awards in the period in which (a) dilution of related Class C Units or LTIP Units would otherwise occur and (b) the award had satisfied other vesting conditions. ● Performance-Based Conditions — Sunlight Financial LLC expensed awards in the period in which (a) it was probable that the performance-based condition was satisfied and (b) the award had satisfied other vesting conditions. For equity-based compensation awards in the form of Class C Units or long-term incentive plan units ( “ LTIP Units ” ) (Note 6), vesting would generally occur upon a qualifying sale of Sunlight ’ s equity. Generally, Sunlight Financial LLC only expensed those awards that only required time-based service conditions since other awards only satisfied vesting requirements upon closing of the Business Combination. Awards that represented services performed prior to the Business Combination reduced the purchase consideration in Sunlight’s calculation of goodwill. Awards that were still subject to time-based service conditions upon closing of the Business Combination and represented future service were replaced with awards of restricted Class A shares and restricted Class EX Units. Sunlight expensed the difference between the value of the existing awards and the replacement awards upon closing of the Business Combination. Sunlight expenses the value of the replacement awards over the remaining service period on a straight-line basis. Selling, General, and Administrative Property and Technology Income Taxes The Company accounts for uncertain tax positions by reporting a liability for unrecognizable tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense. In accordance with the operating agreement of Sunlight Financial LLC, to the extent possible without impairing its ability to continue to conduct its business and activities, and in order to permit its member to pay taxes on the taxable income allocated to those members, Sunlight Financial LLC is required to make distributions to the member in the amount equal to the estimated tax liability of the member computed as if the member paid income tax at the highest marginal federal and state rate applicable to a corporate entity or individual resident in New York, New York to the extent Sunlight’s operations generate taxable income for the applicable member. Sunlight did not declare any distributions for the year ended December 31, 2021. During the year ended December 31, 2020, Sunlight Financial LLC declared $7.5 million in distributions to its unitholders. Business Combination The Business Combination among the parties to the Business Combination Agreement was completed on July 9, 2021. Sunlight accounted for the Business Combination as a business combination under ASC 805, Business Combinations ● Sunlight Financial Holdings Inc. is the sole managing member of Sunlight Financial LLC having full and complete authority over of all the affairs of Sunlight Financial LLC while the non-managing member equity holders do not have substantive participating or kick out rights; ● The predecessor controlling unitholders of Sunlight Financial LLC does not have a controlling interest in the Company as it held less than 50% of the voting interests after the Business Combination. These factors support the conclusion that Sunlight Financial Holdings Inc. acquired a controlling interest in Sunlight Financial LLC and is the accounting acquirer. Sunlight Financial Holdings Inc. is the primary beneficiary of Sunlight Financial LLC, which is a variable interest entity, since it has the power to direct the activities of Sunlight Financial LLC that most significantly impact Sunlight Financial LLC’s economic performance through its role as the managing member. Sunlight Financial Holdings Inc.’s variable interest in Sunlight Financial LLC includes ownership of Sunlight Financial LLC, which results in the right and obligation to receive benefits and absorb losses of Sunlight Financial LLC that could potentially be significant to Sunlight Financial Holdings Inc. Therefore, the Business Combination represented a change in control and is accounted for using the acquisition method. Under the acquisition method of accounting, the purchase price is allocated to the tangible and intangible assets acquired and the liabilities assumed from Sunlight Financial LLC based on their estimated acquisition-date fair values. The cash consideration in the Business Combination included cash from (a) a trust account held by Spartan in the amount of $345.0 million which Spartan received in its initial public offering of 34,500,000 shares of Class A common stock, less $192.3 million withdrawal of funds from that account to fund the redemption of 19,227,063 shares of Class A common stock at approximately $10.00 per share, and (b) $250.0 million in proceeds from the investors purchasing an aggregate of 25,000,000 Class A common stock in connection with the Business Combination (“PIPE Investment”). The Company received $55.1 million, which includes $5.6 million used to pay tax withholding related to cash compensation paid to the Company’s employees at the closing of the Business Combination. The following is an estimate of the fair value of consideration transferred and a preliminary purchase price allocation in connection with the Business Combination: Amount Purchase Consideration Equity consideration paid to existing Sunlight Financial LLC ownership in Class A Common Stock, net (a) $ 357,800 Rollover of Sunlight Financial LLC historical warrants 2,499 Cash consideration to existing Sunlight Financial LLC interests, net (b) 296,281 Cash paid for seller transaction costs 8,289 $ 664,869 Fair Value of Net Assets Acquired Cash and cash equivalents $ 59,786 Restricted cash 3,844 Advances 42,622 Financing receivables 5,117 Goodwill (c) 670,457 Intangible assets (d) 407,600 Property and equipment 1,047 Due from affiliates 1,839 Other assets 4,561 Accounts payable and accrued expenses (19,210) Funding commitments (21,485) Debt (20,613) Due to affiliates (761) Warrants, at fair value — Deferred tax liability (42,212) Other liabilities (512) Fair value of noncontrolling interests (e) (427,211) $ 664,869 (a) Equity consideration paid to Blocker Holders consisted of the following: Common Class A shares 38,151,192 Fair value per share $ 9.46 Equity consideration paid to existing Blocker Holders $ 360,910 Acceleration of post business combination expense (3,110) Equity consideration paid to Sellers, net $ 357,800 (b) Net of $ 0.0 million acceleration of post business combination expense. (c) Goodwill, as a component of the step-up in tax basis from the Business Combination, is tax deductible for the Company. (d) The fair value of the definite-lived intangible assets is as follows: Weighted Average Useful Lives (in Years) Fair Value Contractor relationships 11.5 $ 350,000 Capital provider relationships 0.8 43,000 Trademarks/ trade names 10.0 7,900 Developed technology 5.0 6,700 $ 407,600 (e) Noncontrolling interests represent the 34.9 % ownership in Sunlight Financial LLC not owned by the Sunlight Financial Holdings Inc. as of the Closing Date. The fair value of the noncontrolling interests follows: Common Class EX units 46,216,054 Fair value per unit $ 9.46 Fair value of Class EX units $ 437,204 Less: Postcombination compensation expenses (9,993) Noncontrolling interests $ 427,211 The preliminary allocation of the purchase price is based on preliminary valuations performed to determine the fair value of the net assets as of the Closing Date. This allocation is subject to revision as the assessment is based on preliminary information subject to refinement. The Company incurred $7.0 million of expenses directly related to the Business Combination from January 1, 2021 through July 9, 2021 which were included in acquisition-related expense in the Consolidated Statements of Operations. On the Closing Date, the Company paid $12.1 million of deferred underwriting costs related to Spartan’s initial public offering. At the closing of the Business Combination, $7.5 million of fees related to the PIPE Investment were paid by the Company. Additionally, Sunlight paid $7.9 million of acquisition-related advisory fees related to the Business Combination at the closing of the Business Combination, which success fees were contingent upon the consummation of the Business Combination and not recognized in the Consolidated Statements of Operations of the Predecessor or Successor. The nature of these fees relate to advisory and investment banker fees that were incurred dependent on the success of the Business Combination. The deferred underwriting commissions and costs pertaining to the cost of raising equity were treated as a reduction of equity while Business Combination costs were expensed in the period incurred. Unaudited Pro Forma Operating Results For the Year Ended December 31, 2021 2020 Total revenues $ 114,738 $ 69,564 Net income (loss) before income taxes (217,023) (99,905) Income tax benefit (expense) 3,038 15,138 Noncontrolling interests 75,646 34,824 Net income (loss) attributable to Common Class A shareholders (138,338) (49,944) Recent Accounting Pronouncements Issued, But Not Yet Adopted The Financial Accounting Standards Board (“FASB”) has issued the following Accounting Standard Updates (“ASUs”) that may materially impact Sunlight’s financial position and results of operations, or may impact the preparation of, but not materially affect, Sunlight’s consolidated financial statements. As an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended ( “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”), Sunlight is eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies.” Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. Unless otherwise stated, Sunlight elected to adopt recent accounting pronouncements using the extended transition period applicable to private companies. ASU No. 2020-06 Debt ASU No. 202 |
