The Consolidated and Combined Financial Statements are prepared on a standalone basis through the date of Separation and have been derived from the consolidated financial statements and accounting records of LGL Group through the date of Separation. The following discussion summarizes activity between the Company and LGL Group prior to the Separation.

For purposes of preparing these Consolidated and Combined Financial Statements on a “carve-out” basis, for periods prior to the Separation we have allocated a portion of LGL Group’s corporate expenses totaling $946,000 and $921,000 to the Company for the years ended December 31, 2022 and 2021, respectively, which are recorded within engineering, selling and administrative expenses. See Note A – Description of Business, Basis of Presentation and Summary of Significant Accounting Policies for a discussion of the methodology used to allocate corporate-related costs for purposes of preparing these Consolidated and Combined Financial Statements on a “carve-out” basis.

Balances between the Company and LGL Group that are derived from transactions that have been historically cash settled are reflected in the Consolidated and Combined Balance Sheets as Due from related party. Balances between the Company and LGL Group, Inc. or its affiliates derived from transactions that have been historically settled other than in cash are included in Net Investment by The LGL Group, Inc. within Equity on the Consolidated Combined Balance Sheets.

The following table presents the components of Net Transfers to LGL Group, Inc. in the 2022 and 2021 Consolidated and Combined Statements of Stockholders’ Equity:

	December 31,
	2022			2021
	(in thousands)
Corporate Expense Allocations	$	325		$	29
Share-based Compensation Expense		378			292
Assumed Income Tax Payments		(644	)		(28	)
Write off Intercompany Balance		(4,445	)		—
Total Net Transfers to LGL Group	$	(4,386	)	$	293

LGL Group’s board of directors initially approved a budget of $400,000 for Separation costs. However, the total Separation costs incurred through December 31, 2022 are $838,000 which is $438,000 greater than the budgeted amount. MtronPTI and LGL Group have agreed to share any excess Separation costs. Included in other expense is an amount of $219,000 which represents 50% of the excess Separation costs incurred through December 31, 2022.