SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
Sep. 30, 2025
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES *Basis of presentation* The unaudited condensed consolidated interim financial statements include the accounts of the Company and all wholly owned divisions, including its 100% owned subsidiary, MMG. All significant intercompany accounts and transactions have been eliminated in consolidation. The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and the rules of the SEC and should be read in conjunction with the audited financial statements and notes thereto contained in our Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented, have been reflected herein. The results of operations for the periods presented herein are not necessarily indicative of the results to be expected for the full year. The primary statements are presented on a non-condensed basis; however, the accompanying notes are condensed and do not include all of the information and notes required by U.S. GAAP for complete annual financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2024. There have been no material changes to the accounting policies discussed in Note 3 to the financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 31, 2025. *Concentration of Credit Risk* For the nine months ended September 30, 2025, two clients each accounted for more than 10% of total revenue, representing approximately 28.3% and 28.1%, respectively, or 56.4% in total. For the same period in 2024, three clients exceeded the 10% revenue threshold, contributing approximately 26.2%, 21.2%, and 15.9%, respectively, or 63.3% in total. From an accounts receivable perspective, three clients represented a significant portion of the billed balance as of September 30, 2025. The largest client accounted for $374 or 27.9% of total accounts receivable; the second largest accounted for $268 or 20.0%; and the third accounted for $216 or 16.1% of total accounts receivable of $1,341. On September 30, 2024, the same two principal clients represented $1,555 or 46.3%, and $884 or 26.3% of total accounts receivable of $3,361, respectively. RELIABILITY INCORPORATED AND SUBSIDIARY NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS September 30, 2025 (amounts in thousands, except per share data) *Recently Issued Accounting Pronouncements Not Yet Adopted* On December 14, 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09). The ASU enhances income tax transparency by requiring additional information on the rate reconciliation and cash taxes paid, disaggregated by jurisdiction. ASU 2023-09 is effective for public business entities for annual periods beginning after December 15, 2024 (calendar year 2025 for the Company) and one year later for all other entities. Early adoption is permitted, and the guidance may be applied prospectively or retrospectively. Given the Company’s cumulative net operating losses, full valuation allowance against deferred tax assets, and minimal current tax liabilities, primarily limited to state minimum and franchise taxes; the adoption of ASU 2023-09 is not expected to have a material impact on the Company’s consolidated financial statements or related disclosures. On November 4, 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). The ASU requires disaggregated disclosure of income statement expenses for public business entities. The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. ASU 2024-03 is effective for public business entities for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Entities should adopt this guidance on a prospective basis, though retrospective application is permitted. The Company is currently evaluating how this ASU will impact its year end December 31, 2025 consolidated financial statements and disclosures.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2025

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The unaudited condensed consolidated interim financial statements include the accounts of the Company and all wholly owned divisions, including its 100% owned subsidiary, MMG. All significant intercompany accounts and transactions have been eliminated in consolidation.

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States and the rules of the SEC and should be read in conjunction with the audited financial statements and notes thereto contained in our Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the periods presented, have been reflected herein. The results of operations for the periods presented herein are not necessarily indicative of the results to be expected for the full year. The primary statements are presented on a non-condensed basis; however, the accompanying notes are condensed and do not include all of the information and notes required by U.S. GAAP for complete annual financial statements.

For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2024.

There have been no material changes to the accounting policies discussed in Note 3 to the financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on March 31, 2025.

Concentration of Credit Risk

For the nine months ended September 30, 2025, two clients each accounted for more than 10% of total revenue, representing approximately 28.3% and 28.1%, respectively, or 56.4% in total. For the same period in 2024, three clients exceeded the 10% revenue threshold, contributing approximately 26.2%, 21.2%, and 15.9%, respectively, or 63.3% in total.

From an accounts receivable perspective, three clients represented a significant portion of the billed balance as of September 30, 2025. The largest client accounted for $374 or 27.9% of total accounts receivable; the second largest accounted for $268 or 20.0%; and the third accounted for $216 or 16.1% of total accounts receivable of $1,341. On September 30, 2024, the same two principal clients represented $1,555 or 46.3%, and $884 or 26.3% of total accounts receivable of $3,361, respectively.

RELIABILITY INCORPORATED AND SUBSIDIARY

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2025

(amounts in thousands, except per share data)

Recently Issued Accounting Pronouncements Not Yet Adopted

On December 14, 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09). The ASU enhances income tax transparency by requiring additional information on the rate reconciliation and cash taxes paid, disaggregated by jurisdiction. ASU 2023-09 is effective for public business entities for annual periods beginning after December 15, 2024 (calendar year 2025 for the Company) and one year later for all other entities. Early adoption is permitted, and the guidance may be applied prospectively or retrospectively.

Given the Company’s cumulative net operating losses, full valuation allowance against deferred tax assets, and minimal current tax liabilities, primarily limited to state minimum and franchise taxes; the adoption of ASU 2023-09 is not expected to have a material impact on the Company’s consolidated financial statements or related disclosures.

On November 4, 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). The ASU requires disaggregated disclosure of income statement expenses for public business entities. The ASU does not change the expense captions an entity presents on the face of the income statement; rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements. ASU 2024-03 is effective for public business entities for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Entities should adopt this guidance on a prospective basis, though retrospective application is permitted. The Company is currently evaluating how this ASU will impact its year end December 31, 2025 consolidated financial statements and disclosures.