What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2025-06-27 compared with 2023-12-13 · 205 added, 142 removed, 362 unchanged (49% of the section changed)

1 unchanged sentence

INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES

Report of Independent Registered Public Accounting Firm

Reports of Independent Registered Public Accounting Firms

Consolidated Balance Sheets as of September 30, 2024 and 2023

Consolidated Statements of Operations for the years ended September 30, 2023 and 2022

Consolidated Income Statements for the years ended September 30, 2024 and 2023

Consolidated Statements of Shareholders’ Equity for the years ended September 30, 2024 and 2023

3 unchanged sentences

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Gencor Industries, Inc.:

Opinions on the Consolidated Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Gencor Industries, Inc.

(the “Company”) as of September 30, 2023 and 2022, and the related consolidated statements of operations, shareholders’ equity, and cash flows for each of the years ended September 30, 2023 and 2022, and the related notes (collectively referred to as the consolidated financial statements).

We have also audited the Company’s internal control over financial reporting as of September 30, 2023, based on criteria established in Internal Control – Integrated Framework (2013)

issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of September 30, 2023 and 2022, and the results of its operations and its cash flows for each of the years ended September 30, 2023 and 2022, in conformity with accounting principles generally accepted in the United States of America.

Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September 30, 2023, based on criteria established in Internal Control – Integrated Framework (2013)

issued by COSO.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying “Item 9A, Management’s Annual Report on Internal Control over Financial Reporting”.

Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

To the Board of Directors and Stockholders of

Gencor Industries, Inc.

Opinions on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheet of Gencor Industries, Inc.

(the “Company”) as of September 30, 2024, and the related consolidated statements of income, stockholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of September 30, 2024, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of September 30, 2024, based on the criteria established in Internal

Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in 2013 and our report dated June 27, 2025 expressed an adverse opinion on the effectiveness of the Company’s internal control over financial reporting because of the existence of material weaknesses.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

We conducted our audit in accordance with the standards of the PCAOB.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audits also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and the receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audit provides a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Allowance for Slow-Moving and Obsolete Inventories

As disclosed in Note 1 of the notes to the Company’s consolidated financial statements, the Company records an estimated allowance for slow-moving and obsolete inventories to state the Company’s inventories at the lower of cost or net realizable value.

As disclosed in Note 1 to the Company’s consolidated financial statements, the Company records an estimated allowance for slow-moving and obsolete inventories to state the Company’s inventories at the lower of cost or net realizable value.

The Company relies on, among other things, past usage, sales experience, recent order and quote activity, possible alternative uses, future sales forecasts, and its strategic business plan to develop the estimate.

As a result of management’s assessment, the Company recorded an allowance for slow-moving and obsolete inventories of approximately $13,331,000 as of September 30, 2024.

Auditing management’s estimate of the allowance for slow-moving and obsolete inventories involved subjective evaluation and high degree of auditor judgement due to significant assumptions involved in estimating future inventory turnover and sales.

Auditing management’s estimate of the allowance for slow-moving and obsolete inventories involved subjective evaluation and a high degree of auditor judgement due to significant assumptions involved in estimating future inventory turnover and sales.

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested operating effectiveness of certain internal controls that address the risks of material misstatement relating to recording inventory at the lower of cost or net realizable value.

We tested the accuracy and completeness of the underlying data used in calculating the inventory allowance, including testing of a sample of inventory usage transactions, and recomputed the allowance calculation.

We also evaluated the Company’s ability to accurately estimate the assumptions used to develop the estimate by comparing historical allowance amounts to the history of actual inventory write-offs.

Furthermore, we reviewed management’s business plan and forecasts of future sales.

Furthermore, we reviewed subsequent sales activity on items with partial reserves to assess the impact to the year-end allowance.

Revenue from Contracts with Customers Where Revenue is Recognized Over Time

As disclosed in Note 1 of the notes to the Company’s consolidated financial statements, the Company recognizes revenues from contracts with customers for the design, manufacture and sale of custom equipment over time when the performance obligation is satisfied by transferring control of the equipment.

Control of the equipment transfers over time, as the equipment is unique to the specific contract and thus does not create an asset with an alternative use to the Company.

As disclosed in Note 1 to the Company’s consolidated financial statements, the Company recognizes revenues from contracts with customers for the design, manufacture and sale of custom equipment which is recognized over time.

Revenues and costs are recognized in proportion to actual labor costs incurred, as compared with total estimated labor costs expected to be incurred, during the entire contract.

3 unchanged sentences

The following are the primary procedures we performed to address this critical audit matter.

We evaluated the design and tested operating effectiveness of certain internal controls that address the risks of material misstatement relating to recording revenue from contracts with customers where revenue is recognized over time.

We tested the accuracy and completeness of the underlying data used in calculating the percentage of completion on incomplete contracts, including review of contracts, change orders, and underlying labor and material costs, and recomputed the percentage of completion on individual contracts.

We also evaluated the Company’s ability to accurately estimate the assumptions used to develop the estimate by comparing historical cost estimates to actual costs on completed contracts.

We have served as the Company’s auditor since 2001.

Uncertain Tax Positions

As disclosed in Note 6 to the Company’s consolidated financial statements, the Company utilizes a two-step approach for recognizing and measuring uncertain tax positions.

The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, based on the technical merits of the position.

The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement.

The Company had a total uncertain tax position liability of $1,376,000 as of September 30, 2024, which increased by $1,200,000 from the previous year.

Auditing management’s estimate of uncertain tax position liability involved subjective evaluation and a high degree of auditor judgement due to significant assumptions and considerable inputs involved in estimating the uncertain tax position liability.

The following are the primary procedures we performed to address this critical audit

We obtained an understanding and evaluated management’s process for identifying state filing requirements and evaluating uncertain tax positions.

We performed a nexus analysis for each state where the Company operates, sells products, owns assets or employs personnel.

We also recalculated management’s estimate and compared our own independent estimate to that recorded by management for uncertain tax positions.

We have served as Gencor Industries, Inc.’s auditor since 2025.

Berkowitz Pollack Brant Advisors + CPAs

BERKOWITZ POLLACK BRANT ADVISORS + CPA S

PCAOB ID Number:

West Palm Beach, Florida

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Gencor Industries, Inc.:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheet of Gencor Industries, Inc.

(the “Company”) as of September 30, 2023, and the related consolidated statements of income, shareholders’ equity, and cash flows for the year then ended, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of September 30, 2023, and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audit.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

We have served as the Company’s auditor from 2001 to 2024.

/s/ MSL, P.A.

2 unchanged sentences

Orlando, Florida

December 13, 2023

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

ON INTERNAL CONTROL OVER FINANCIAL REPORTING

To the Board of Directors and Stockholders of

Gencor Industries, Inc.

Adverse Opinion on Internal Control over Financial Reporting

We have audited Gencor Industries, Inc.’s (the Company’s) internal control over financial reporting as of September 30, 2024, based on criteria established in Internal Control—Integrated Framework (2013)

issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, because of the effect of the material weaknesses described in the following paragraph on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial reporting as of September 30, 2024, based on criteria established in Internal Control—Integrated Framework (2013)

issued by COSO.

A material weakness is a control deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

The following material weaknesses have been identified and included in management’s assessment:

Ineffective information technology general controls (“ITGC’s”), particularly such controls related to user access, program change management, and ineffective complementary user-organization controls, which limited management’s ability to rely on technology-dependent controls relevant to the Company’s consolidated financial statements.

As a result, information technology-dependent manual and automated controls that rely on the affected ITGC’s, or information from the information technology systems with affected ITGC’s, were also ineffective.

Ineffective design, implementation, and operation of controls over key third party service provider System and Organizational Controls reports.

Ineffective controls over the period end close process, including the review and approval process of journal entries, account reconciliations, and segregation of duties.

Inadequate documentation and design of controls related to various key financial statement accounts and assertions.

Inadequate risk assessment, control activities, information and communication, and monitoring components of the Company’s internal control framework such that internal control weaknesses were not detected, communicated, addressed with mitigating control activities, or remediated on a timely basis.

These material weaknesses were considered in determining the nature, timing and extent of audit tests applied in our audit of the consolidated financial statements, and this report does not affect our report dated June 27, 2025 on those consolidated financial statements.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet and the related consolidated statements of income, stockholders’ equity, and cash flows of the Company, and our report dated June 27, 2025, expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying “Management Annual Report on Internal Control Over Financial Reporting”.

Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles.

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

/s/ Berkowitz Pollack Brant Advisors + CPAs

BERKOWITZ POLLACK BRANT ADVISORS + CPA S

PCAOB ID Number:

West Palm Beach, Florida

June 27, 2025

Financial Information

4 unchanged sentences

Cash and cash equivalents

Marketable securities at fair value (cost of $ 85,514,000 at September 30, 2023 and $ 94,879,000 at

September 30, 2022)

Accounts receivable, less allowance for doubtful accounts of $ 545,000 at September 30, 2023 and $ 370,000 at September 30, 2022

Costs and estimated earnings in excess of billings

Marketable securities

at fair value (cost of $ 88,777,000 at September 30, 2024 and $ 85,514,000 at September 30, 2023)

Accounts receivable, less allowance for credit losses of $ 390,000 at September 30, 2024 and $ 545,000 at September 30, 2023

Contract assets

Inventories, net

11 unchanged sentences

Total current liabilities

operating lease liabilities

Unrecognized tax benefits

Total liabilities

7 unchanged sentences

15,000,000 shares authorized;

12,338,845 shares issued and

outstanding at September 30, 2023 and 2022

12,338,845 shares issued and outstanding at September 30, 2024 and 2023

Class B Stock, par value $.

1 unchanged sentence

6,000,000 shares authorized;

2,318,857 shares issued and outstanding at

September 30, 2023 and 2022

2,318,857 shares issued and outstanding at September 30, 2024 and 2023

Capital in excess of par value

4 unchanged sentences

GENCOR INDUSTRIES, INC.

Consolidated Statements of Operations

Consolidated Income Statements

For the Years Ended September 30, 2024 and 2023

7 unchanged sentences

Interest and dividend income, net of fees

Realized and unrealized gains (losses) on marketable securities, net

( 5,860,000 )

Income (loss) before income tax expense (benefit)

Income tax expense (benefit)

Net income (loss)

Basic earnings (loss) per common share

Diluted earnings (loss) per common share

Realized and unrealized

gains (losses) on marketable securities, net

Income before income tax expense

Income tax expense

Net income per common share – basic and diluted

See accompanying Notes to Consolidated Financial Statements

6 unchanged sentences

September 30, 2024

September 30, 2023

See accompanying Notes to Consolidated Financial Statements

3 unchanged sentences

Cash flows from operating activities:

Net income (loss)

Adjustments to reconcile net income (loss) to cash flows provided by (used in) operating activities:

Purchase of marketable securities

( 172,341,000

( 135,551,000

Proceeds from sale and maturity of marketable securities

Change in value of marketable securities

Adjustments to reconcile net income to cash flows provided by operating activities:

Unrealized gain on marketable securities

Deferred and other income taxes

Unrecognized tax benefits

Depreciation and amortization

Provision for doubtful accounts

Provision for credit losses

Loss on disposal of assets

Changes in assets and liabilities, excluding the initial effects of business combinations:

Changes in operating assets and liabilities:

Accounts receivable

Costs and estimated earnings in excess of billings

Contract assets

Marketable securities

Prepaid expenses

3 unchanged sentences

Total adjustments

Cash flows provided by (used in) operating activities

provided by operating activities

Cash flows used in investing activities:

1 unchanged sentence

Cash flows used in investing activities

Net increase (decrease) in cash and cash equivalents

Net increase in cash and cash equivalents

Cash and cash equivalents at:

1 unchanged sentence

investing and financing activities:

Operating lease right-of-use

Operating lease liabilities

assets obtained in exchange for operating lease liabilities

See accompanying Notes to Consolidated Financial Statements

15 unchanged sentences

Actual results could differ from those estimates.

Earnings (Loss)

The consolidated financial statements include basic and diluted earnings (loss) per share (“EPS”) information.

Earnings per Share

The consolidated financial statements include basic and diluted earnings per share (“EPS”) information.

Basic EPS is based on the weighted-average number of shares outstanding.

Diluted EPS is based on the sum of the weighted-average number of shares outstanding plus common stock equivalents.

There were no common stock equivalents as of September 30, 2023 and September 30, 2022.

There were no equity compensation plans and arrangements previously approved by security holders as of September 30, 2024 and 2023 and there are no common stock equivalents as of September 30, 2024 and September 30, 2023.

The following presents the calculation of the basic and diluted EPS for the years ended September 30, 2024 and 2023:

Common stock equivalents

Weighted average common shares outstanding – basic and diluted

Net income per common share – basic and diluted

Cash Equivalents

3 unchanged sentences

Fair value is determined using the quoted closing or latest bid prices for Level 1 investments and market standard valuation methodologies for Level 2 investments.

Realized gains and losses on investment transactions are determined by specific identification and are recognized as incurred in the consolidated statements of operations.

Net changes in unrealized gains and losses are reported in the consolidated statements of operations in the current period.

Realized gains and losses on investment transactions are determined by specific identification and are recognized as incurred in the consolidated income statements.

Net changes in unrealized gains and losses are reported in the consolidated income statements in the current period.

Fair Value Measurements

2 unchanged sentences

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

The fair value of marketable equity securities (stocks), mutual funds, exchange-traded funds, government securities, and cash and money funds, are substantially based on quoted market prices (Level 1).

The fair value of exchange-traded funds, government securities, and cash and money funds, are substantially based on quoted market prices (Level 1).

Corporate bonds are valued using market standard valuation methodologies, including:

12 unchanged sentences

Cash and Money Funds

Net unrealized gains reported during fiscal 2023 on trading securities still held as of September 30, 2023, were $ 4,316,000 .

Net unrealized gains and losses reported during fiscal 2024 on trading securities still held as of September 30, 2024, were $ 2,412,000 .

There were no transfers of investments between Level 1 and Level 2 during the year ended September 30, 2024.

$ 10,000,000 was transferred from the investment portfolio to cash to fund operating needs of the business during fiscal 2023.

The following table sets forth by level, within the fair value hierarchy, the Company’s assets measured at fair value as of September 30, 2023:

4 unchanged sentences

Cash and Money Funds

Net unrealized losses reported during fiscal 2022 on trading securities still held as of September 30, 2022, were $( 6,864,000 ).

Net unrealized gains and losses reported during fiscal 2023 on trading securities still held as of September 30, 2023, were $ 4,316,000 .

There were no transfers of investments between Level 1 and Level 2 during the year ended September 30, 2023.

$ 10,000,000 was transferred from the investment portfolio to cash to fund

operating needs of the business during fiscal 2023.

The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, customer deposits and accrued expenses approximate fair value because of the short-term nature of these items.

5 unchanged sentences

Operating cash is retained in overnight sweep accounts which allow for offsets to treasury service charges.

The marketable securities include investments in cash and money funds, mutual funds, exchange traded funds (“ETF’s”), corporate bonds, government securities and equities

through professional investment management firms.

The marketable securities include investments in cash and money funds, mutual funds, exchange traded funds (“ETF’s”), corporate bonds, government securities and equities through professional investment management firms.

Investment securities are exposed to various risks, such as interest rate, market and credit risks.

3 unchanged sentences

deposit before beginning manufacturing on complete asphalt plant and component orders, and requires full payment subject to hold-back provisions prior to shipment.

The Company establishes an allowance for doubtful accounts based upon the credit risk of specific customers, historical trends and other pertinent information.

The Company establishes an allowance for credit losses based upon the credit risk of specific customers, historical trends and other pertinent information.

Inventories are valued at the lower of cost or net realizable value, with cost being determined under the FIFO method and net realizable value defined as the estimated selling price of goods less reasonable costs of completion and delivery.

Appropriate consideration is given to obsolescence, excessive levels, deterioration, possible alternative uses and other factors in determining net realizable value.

Appropriate consideration is given to obsolescence, excessive levels, physical deterioration, possible alternative uses and other factors in determining net realizable value.

The cost of work in process and finished goods includes materials, direct labor, variable costs and overhead.

The Company evaluates the need to record inventory adjustments on all inventories, including raw material, work in process, finished goods, spare parts and used equipment.

The Company evaluates the need to record inventory adjustments on all inventories,

including raw material, work in process, finished goods, spare parts and used equipment.

Used equipment acquired by the Company on trade-in

12 unchanged sentences

Land improvements

Buildings & improvements

Buildings and improvements

Property and equipment, and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset (or asset group) may not be recoverable.

5 unchanged sentences

The Company accounts for revenues and related expenses under the provisions of ASU No.

– Revenue from Contracts with Customers (Topic 606)

The following table disaggregates the Company’s net revenue by major source for the years ended September 30, 2024 and 2023:

5 unchanged sentences

Control of the equipment transfers over time, as the equipment is unique to the specific contract and thus does not create an asset with an alternative use to the Company.

Revenues and costs are recognized in proportion to actual labor costs incurred, as compared with total estimated labor costs expected to be incurred, during the entire contract.

Revenues and costs are recognized in proportion to actual labor costs incurred, as compared with total estimated

labor costs expected to be incurred, during the entire contract.

All incremental costs related to obtaining a contract are expensed as incurred, as the amortization period is less than one year.

1 unchanged sentence

Contract assets (excluding accounts receivable) under contracts with customers represent revenue recognized in excess of amounts billed on equipment sales recognized over time.

These contract assets were $ 1,508,000 and $ 2,118,000 at September 30, 2023 and 2022, respectively, and are included in current assets as costs and estimated earnings in excess of billings on the Company’s consolidated balance sheets.

These contract assets were $ 9,339,000 and $ 1,508,000 at September 30, 2024 and 2023, respectively, and are included in current assets on the Company’s consolidated balance sheets.

The Company anticipates that all of the contract assets at September 30, 2024, will be billed and collected within one year .

Revenues from all other contracts for the design and manufacture of equipment, for service and for parts sales, net of any discounts and return allowances, are recorded at a point in time when control of the goods or

services has been transferred.

Control of the goods or service typically transfers at time of shipment or upon completion of the service.

11 unchanged sentences

Under certain contracts with customers, recognition of a portion of the consideration received may be deferred and recorded as a contract liability if the Company has to satisfy a future obligation, such as to provide installation assistance.

There were no contract liabilities other than customer deposits at September 30, 2023 and September 30, 2022.

Customer deposits related to contracts with customers were $ 6,815,000 and $ 5,864,000 at September 30, 2023 and 2022, respectively, and are included in current liabilities on the Company’s consolidated balance sheets.

There were no contract liabilities other than customer deposits at September 30, 2024 and 2023.

Customer deposits related to contracts with customers

were $ 5,018,000 and $ 6,815,000 at September 30, 2024 and 2023, respectively, and are included in current liabilities on the Company’s consolidated balance sheets.

The Company records revenues earned for shipping and handling as freight revenue at the time of shipment, regardless of whether or not it is identified as a separate performance obligation.

2 unchanged sentences

Provision is made for any anticipated contract losses in the period that the loss becomes evident.

The allowance for doubtful accounts is determined by performing a specific review of all account balances greater than 90 days past due and other higher risk amounts to determine collectability, and also adjusting for any known customer payment issues with account balances in the less-than-90-day

The allowance for credit losses is determined by performing a specific review of all account balances greater than 90 days past due and other higher risk amounts to determine collectability, and also adjusting for any known customer payment issues with account balances in the less-than-90-day

past due aging category.

Account balances are charged off against the allowance for doubtful accounts when they are determined to be uncollectible.

Any recoveries of account balances previously considered in the allowance for doubtful accounts reduce future additions to the allowance for doubtful accounts.

The allowance for doubtful accounts also includes an estimate for returns and allowances.

Account balances are charged off against the allowance for credit losses when they are determined to be uncollectible.

Any recoveries of account balances previously considered in the allowance for credit losses reduce future additions to the allowance for credit losses.

The allowance for credit losses also includes an estimate for returns and allowances.

Provisions for estimated returns and allowances and other adjustments, are provided for in the same period the related sales are recorded.

Returns and allowances, which reduce product revenue, are estimated using known issues and historical experience.

Changes in the allowance for doubtful accounts as of September 30, 2023 and 2022 consisted of the following:

Changes in the allowance for credit losses as of September 30, 2024 and 2023 consisted of the following:

Balance, beginning of year

Provision for doubtful accounts

Provision for credit losses

Provision for estimated returns and allowances

2 unchanged sentences

Balance, end of year

Shipping and Handling Costs

Shipping and handling costs are included in production costs in the consolidated statements of operations.

Income taxes are provided for the tax effects of transactions reported in the consolidated financial statements and primarily consist of taxes currently due, plus deferred taxes (see Note 6 – Income Taxes).

22 unchanged sentences

Customers with 10% (or greater) of Net Revenues

During the year ended September 30, 2023, one customer accounted for 14.8 % of net revenue.

No customer accounted for 10 % or more of net revenue for the year ended September 30, 2022.

During the year ended September 30, 2024, one

customer accounted for 11.3 % of net revenue.

One customer accounted for 14.8 % of net revenue for the year ended September 30, 2023.

Subsequent Events

Management has evaluated events occurring from September 30, 2023 through the

date these consolidated financial statements were filed with the Securities and Exchange Commission for proper recording and disclosure herein.

Management has evaluated events occurring from September 30, 2024 through the date these consolidated

financial statements were filed with the Securities and Exchange Commission for proper recording and disclosure herein.

Reclassifications

Certain amounts in the September 30, 2023 consolidated financial statements have been reclassified to conform to the current year presentation.

These reclassifications had no impact on previously reported net income for the year ended September 30, 2023.

NOTE 2 – INVENTORIES

7 unchanged sentences

Slow-moving and obsolete inventory reserves were $ 13,331,000 and $ 9,813,000 at September 30, 2024 and 2023, respectively.

NOTE 3 – COSTS AND ESTIMATED EARNINGS IN EXCESS OF BILLINGS

Costs and estimated earnings in excess of billings on uncompleted contracts as of September 30, 2023 and 2022 consisted of the following:

NOTE 3 – CONTRACT ASSETS

Contract assets reflect costs and estimated earnings in excess of billings on uncompleted contracts and consisted of the following as of September 30, 2024 and 2023:

September 30,

2 unchanged sentences

Billings to date

Costs and estimated earnings in excess of billings

Contract assets

NOTE 4 – PROPERTY AND EQUIPMENT

6 unchanged sentences

Property and equipment includes approximately $ 23,365,000 and $ 22,693,000 of fully depreciated assets, which remained in service during fiscal 2024 and 2023, respectively

Also, included in property and

equipment as of September 30, 2023 and 2022 is approximately $ 1,295,000 and $ 1,702,000 , respectively, of assets not yet placed in operation and, therefore, not subject to depreciation during the years ended September 30, 2023 and 2022, respectively.

Also, included in property and equipment as of September 30, 2024 and 2023 is approximately $ 1,327,000 and $ 1,295,000 , respectively, of assets not yet placed in operation and, therefore, not subject to depreciation during the years ended September 30, 2024 and 2023, respectively.

NOTE 5 – ACCRUED EXPENSES

8 unchanged sentences

NOTE 6 – INCOME TAXES

The provision for income tax expense (benefit) consisted of the following:

The provision for income tax expense consisted of the following:

Year Ended September 30,

1 unchanged sentence

Total deferred

Income tax expense (benefit)

A reconciliation of the federal statutory tax rate to the total tax provision (benefit) is as follows:

Income tax expense

A reconciliation of the federal statutory tax rate to the total tax provision is as follows:

Year Ended September 30,

1 unchanged sentence

State income taxes, net of federal benefit

Research & development tax refunds & credits

Dividend received deduction

Unrecognized tax benefits

Effective income tax rate

3 unchanged sentences

Accrued liabilities and reserves

Allowance for doubtful accounts

Allowance for credit losses

Unrealized loss on investments

2 unchanged sentences

Deferred and Other Tax Liabilities:

Domestic international sales corporation

Unrealized gain on investments

Property and equipment

Unrecognized tax benefits

Gross Deferred and Other Income Tax Liabilities

11 unchanged sentences

As of September 30, 2024 and 2023, the Company had UTB’s of $ 1,376,000 and $

The Company accrued $ 45,000 and $ 131,000 of UTB’s in the years ended September 30, 2023 and September 30, 2022, respectively.

UTB’s of $ 150,000 at September 30, 2021 were used in the year ended September 30, 2022.

176,000 , respectively.

The Company accrued $ 1.2 million of UTB’s in the year ended September 30, 2024.

The Company accrued $ 45,000 of UTB’s in the year ended September 30, 2023.

A reconciliation of the beginning and ending amount of our unrecognized tax benefits for the year ended September 30, 2024 is as follows:

Balance, beginning of year

Additions based on tax positions related to the current year

Additions based on tax positions of prior years

Balance, end of year

The Company recognizes interest and penalties accrued related to UTB’s as a component of income tax expense.

There were no additional accruals of interest expense nor penalties of significance during fiscal years ended September 30, 2023 and 2022.

no additional accruals of interest expense nor penalties of significance during fiscal years ended September 30, 2024 and 2023.

It is reasonably possible that the amount of the UTB’s with respect to certain unrecognized tax positions will increase or decrease during the next 12 months.

3 unchanged sentences

The effective income tax rate for fiscal 2024 was 29.8 % versus 21.9 % in fiscal 2023.

In fiscal 2022, the Company generated $ 475,000 of federal research and development tax credits (“R&D Credits”), all of which were used in fiscal 2022.

There were no R&D Credits generated in fiscal 2023 and there were no carryforwards of R&D Credits as of September 30, 2023 or September 30, 2022.

There were no R&D Credits generated in fiscal 2024 or 2023 and there were no carryforwards of R&D Credits as of September 30, 2024 or September 30, 2023.

The Company files U.S.

federal income tax returns, as well as Florida, Iowa and Pennsylvania income tax returns.

federal income tax returns, as well as income tax returns in multiple state jurisdictions.

No income tax returns are currently under examination by taxing authorities.

The Company’s U.S.

federal income tax returns filed for tax years prior to fiscal year ended September 30, 2021 are generally no longer subject to examination by taxing authorities due to the expiration of the statute of limitations.

With a few exceptions, the Company is no longer subject to state and local income tax examinations for periods prior to fiscal 2020.

NOTE 7 – RETIREMENT BENEFITS

7 unchanged sentences

The maximum amount that can be drawn by the beneficiary under the letter of credit is $ 150,000 .

The letter of credit expires in April 2024, unless terminated earlier, and can be extended, as provided by the agreement.

The Company intends to renew the letter of credit for as long as the Company does business with the beneficiary insurance carrier.

The letter of credit expires in February 2026

, unless terminated earlier, and can be extended, as provided by the agreement.

The Company intends to renew the letter of credit for as long as the Company does business with the beneficiary

insurance carrier.

The letter is collateralized by restricted cash of the same amount on any outstanding drawings.

4 unchanged sentences

Future minimum rental payments under these leases at September 30, 2024 are immaterial.

Total rental expense for the fiscal years ended September 30, 2023 and 2022 was $ 47,000 and $ 57,000 , respectively.

On August 28, 2020, the Company entered into a three-year operating lease for property related to the manufacturing and warehousing of the Blaw-Knox assets.

Total rental expense for both of the fiscal years ended September 30, 2024 and

2023 was $ 47,000 .

On August 28, 2020, the Company entered into a three-year operating lease for property related to the manufacturing and warehousing.

The lease term was for the period beginning on September 1, 2020 through August 31, 2023 .

In accordance with ASU 2016-02

the Company recorded a ROU asset totaling $ 970,000 and related lease liabilities at inception.

– Leases (Topic 842)

, the Company recorded a right-of-use

(“ROU”) asset totaling

$ 970,000 and related lease liabilities at inception.

In March 2023, the Company extended the lease term through August 31, 2024.

1 unchanged sentence

the Company recorded a ROU asset totaling $ 352,000 and related lease liabilities upon extension.

On October 9, 2020, the Company entered into an operating lease for additional warehousing space.

The original lease term was for one year beginning November 2020 with automatic one-year

In March 2024, the Company extended the lease term through August 31, 2025 .

In accordance with ASU 2016-02,

the Company recorded a ROU asset totaling $ 254,000 and related lease liabilities at inception.

An additional $ 39,000 was recorded as a ROU asset and related lease liability in October 2021 to reflect the impact of the lease renewal.

In March 2022, the ROU asset and related liability was reduced by $ 39,000 to reflect the impact of a reduction in the square footage being leased.

the Company recorded a ROU asset totaling $ 361,000 and related lease liabilities upon extension.

For the year ended September 30, 2024, operating lease costs were $ 432,000 and cash payments related to these operating leases were $ 463,000 .

For the year ended September 30, 2022, operating lease costs were $ 425,000 and cash payments related to

these operating leases were $ 396,000 .

For the year ended September 30, 2023, operating lease costs were $ 429,000 and cash payments related to these operating leases were $ 458,000 .

Other information concerning the Company’s operating lease accounted for under ASC 842 guidelines as of September 30, 2024 and September 30, 2023, is as follows:

3 unchanged sentences

Current operating lease liability

operating lease liability

Weighted average remaining lease term (in years)

10 unchanged sentences

Under the Company’s Certificate of Incorporation, as amended, certain rights of the holders of the Company’s common stock are modified by shares of Class B stock for as long as such shares shall remain outstanding.

During that period, holders of common stock will have the right to elect approximately 25 % of the Company’s Board of Directors, and conversely, holders of Class B stock will be entitled to elect approximately 75 % of the Company’s Board of Directors.

During that period, holders

of common stock will have the right to elect approximately 25 % of the Company’s Board of Directors

, and conversely, holders of Class B stock will be entitled to elect approximately 75 % of the Company’s Board of Directors.

During the period when shares of common stock and Class B stock are outstanding, certain matters submitted to a vote of shareholders will also require approval of the holders of common stock and Class B stock, each voting separately as a class.

1 unchanged sentence

Stock-Based Compensation

On March 17, 2009, the shareholders of the Company approved the 2009 Incentive Compensation Plan (the “2009 Plan”).

The 2009 Plan expired on October 1, 2021 , and 30,000 remaining outstanding options were cancelled on November 1, 2021 .

There were no other equity compensation plans and arrangements previously approved by security holders as of September 30, 2023 and September 30, 2022.

There were no equity compensation plans and arrangements previously approved by security holders as of September 30, 2024 and 2023.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data