| Summary of Significant Accounting Principles and Policies | NOTE
1 - Summary of Significant Accounting Principles and Policies Basis
of Presentation and Preparation Wireless
Telecom Group, Inc., a New Jersey corporation, together with its subsidiaries (“we”, “us”, “our”
or the “Company”), is pursuing strategic alternatives to accelerate the realization of value for our shareholders. On January
1, 2022, the Company was comprised of Wireless Telecom Group, Inc., doing business as, and operating under the trade name NoiseCom, Inc.,
and its wholly owned subsidiaries including Boonton Electronics Corporation, Microlab/FXR, Wireless Telecommunications Group Ltd., CommAgility
Limited and Holzworth Instrumentation, Inc. (NoiseCom, Inc., Boonton Electronics Corporation, Microlab/FXR LLC, CommAgility Limited Ltd.,
and Holzworth Instrumentation, Inc. are hereinafter referred to as “Noisecom”, “Boonton”, “Microlab”,
“CommAgility” and “Holzworth”, respectively). Our product groups were organized as follows: Radio Frequency Components
(“RFC”) was comprised of our Microlab brand; Radio, Baseband, Software (“RBS”) was comprised of our CommAgility
brand; and Test and Measurement (“T&M”) was comprised of our Boonton, Noisecom and Holzworth brands. As
more fully described in Note 3 below, on March 1, 2022, the Company completed the sale of Microlab to RF Industries, Ltd and on December
30, 2022 completed the sale of CommAgility to E-Space Acquisitions, LLC. Subsequent to the divestitures of Microlab and CommAgility,
the Company is comprised of the T&M business which is made up of our Boonton, Noisecom and Holzworth brands. The T&M business
provides radio frequency (“RF”) and microwave test equipment and low phase noise RF synthesizers to equipment manufacturers,
aerospace and defense companies, military and government agencies, satellite communication companies, semiconductor companies and other
global technology companies. Our
consolidated financial statements as of and for the three months ended March 31, 2023 include the accounts of Noiscom, Boonton and Holzworth
and have been prepared using accounting principles generally accepted in the United States (“U.S. GAAP”). In accordance with
applicable accounting guidance, the results of Microlab and CommAgility are presented as discontinued operations in the consolidated
financial statements for the three months ended March 31, 2022. All intercompany transactions and balances have been eliminated in consolidation. It
is suggested that these interim consolidated financial statements be read in conjunction with the audited consolidated financial statements,
and the notes thereto, included in the Company’s latest annual report (Form 10-K). The
Company’s fiscal periods are based on the calendar year. Except as otherwise specified, references to “first quarter(s)”
or “three months” indicate the Company’s fiscal periods ended March 31, 2023 and March 31, 2022, and references to
“year-end” indicate the fiscal year ended December 31, 2022. Consolidated
Financial Statements In
the opinion of management, the accompanying consolidated financial statements referred to above contain allnecessary adjustments, consisting
of normal accruals and recurring entries, which are necessary to fairly present the Company’s results for the interim periods being
presented. The
accounting policies followed by the Company are set forth in Note 1 to the Company’s consolidated financial statements included
in its annual report on Form 10-K for the year ended December 31, 2022. Specific reference is made to that report since certain information
and footnote disclosures normally included in financial statements in accordance with US GAAP have been reduced for interim periods in
accordance with SEC rules. The
results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the
full year ending December 31, 2023. Critical
Accounting Estimates The
preparation of our consolidated financial statements requires the Company to make estimates and judgments that affect the reported amount
of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amount of
revenues and expenses for each period. We base our assumptions, judgements and estimates on historical experience and various other factors
that we believe to be reasonable under the circumstances. At least quarterly, we evaluate our assumptions, judgments and estimates, and
make changes as deemed necessary. Recent
inflationary pressures and the conflict between Russia and Ukraine have negatively impacted regional and global economies, disrupted
global supply chains and created significant volatility and disruption of financial markets. Although these disruptions did not impact
our estimates and judgements as of the date of this report, it is reasonably possible that our accounting estimates and judgements may
change as new events occur and additional information becomes available or is obtained. Furthermore, actual results could differ materially
from our estimates as of the date of issuance of this Quarterly Report on Form 10-Q under different assumptions or conditions. For
further information about our critical accounting estimates, see the discussion in Item 7, “Management’s Discussion and Analysis
of Financial Condition and Results of Operations,” under the heading “Critical Accounting Policies” in our Annual Report
on Form 10-K for the fiscal year ended December 31, 2022. Concentration
Risk Financial
instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents and
trade accounts receivable. Credit
evaluations are performed on customers requiring credit over a certain amount. Credit risk is mitigated to a lesser extent through collateral
such as letters of credit, bank guarantees or payment terms like cash in advance. One
customer accounted for 19.0% 14.1% One
customer accounted for 15.4% 16.5% Fair
Value of Financial Instruments Fair
value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction
between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the
inputs used in the valuation methodologies in measuring fair value: Level
1 - Quoted prices in active markets for identical assets or liabilities. Level
2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in markets that are not active;
or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or
liabilities. Level
3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or
liabilities. The
categorization of a financial instrument within the valuation hierarchy is based on the lowest level of input that is significant to
the fair value measurement. The
carrying amounts of the Company’s financial instruments, including cash, accounts receivable, accounts payable and accrued liabilities,
approximate fair value due to their relatively short maturities. Accounts
Receivable Accounts
receivable are recorded and carried at the original invoiced amount less allowances for credits and for any potential uncollectible amounts
due to credit losses in accordance with ASU 2016-13 Financial Instruments – Credit Losses (Topic 326) 100,000 Segments The
Company evaluates its financial reporting in accordance with ASC 280 Segment Reporting. |
