b'Capital Region Airport Commission NOTES TO FINANCIAL STATEMENTS June 30, 2025 and 2024 Note 1.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) Allowance for Doubtful Accounts The allowance for doubtful accounts reflects managements best estimate of probable losses inherent in the accounts receivable balance. The allowance is determined based on known troubled accounts, historical experience, and other currently available evidence. The allowance activity in the allowance for doubtful accounts was as follows: 2025 2024Balance, beginning of period $480,613 $ 433,842Charged to costs and other write-offs Bad debt expense137,46246,771Balance, end of period $618,075 $ 480,613Leases and Subscription-Based IT Arrangements (SBITAs) TheCommissionhasvariousleaseassetsandsubscription-basedITarrangements(SBITAs)requiring recognition. A lease is a contract that conveys control of the right to use another entitys nonfinancial asset. Lease recognition does not apply to short-term leases, contracts that transfer ownership, leases of assets that are investments, or certain regulated leases. A SBITA is defined as a contract that conveys control of the right to use another partys (a SBITA vendors) information technology (IT) software, alone or in combination with tangible capital assets (the underlying IT assets), as specified in the contract for a period of time in an exchange or exchange-like transaction. LessorThe Commission recognizes leases receivable and deferred inflows of resources. At commencement of the lease, the lease receivable is measured at the present value of lease payments expected to be received during the lease term, reduced by any provision for estimated uncollectible amounts. Subsequently, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources is measured at the initial amount of the lease receivable, less lease payments received from the lessee at or before the commencement of the lease term (less any lease incentives).Lessee The Commission recognizes lease liabilities and intangible right-to-use lease assets (lease assets) with an initial value of $7,500, individually or in the aggregate. At the commencement of the lease, the lease liability is measured at the present value of payments expected to be made during the lease term (less any lease incentives). The lease liability is reduced by the principal portion of payments made. The lease asset is measured at the initial amount of the lease liability, plus any payments made to the lessor at or before the commencement of the lease term and certain direct costs. The lease asset is amortized over the shorter of the lease term or the useful life of the underlying asset.Subscriptions TheCommissionrecognizesintangibleright-to-usesubscriptionassets(subscriptionassets)and correspondingsubscriptionliabilitieswithaninitialvalueof$7,500,individuallyorinthe.Atthe commencement of the subscription, the subscription liability is measured at the present value of payments expected to be made during the subscription liability term (less any contract incentives). The subscription liability is reduced by the principal portion of payments made. The subscription asset is measured at the initial amount of the subscription liability payments made to the SBITA vendor before commencement of the subscription term, and capitalizable implementation costs, less any incentives received from the SBITA vendor at or before the commencement of the subscription term. The subscription asset is amortized over the shorter of the subscription term or the useful life of the underlying IT asset. 27'