CTW Cayman

Internal-use software development costs

The Company accounts for internal-use software in accordance with ASU 2025-06, adopted effective August 1, 2025 on a prospective basis.

The Company capitalizes certain costs incurred in connection with developing or obtaining internal-use software and hosted cloud computing arrangements. Costs capitalized primarily include, 1) payroll and payroll-related costs for employees directly involved in software development activities; 2) fees paid to third-party developers and consultants; and 3) certain implementation and configuration costs associated with cloud-based software arrangements.

Capitalization begins when (a) management authorizes and commits to funding the software project, and (b) it is probable that the project will be completed and the software will be used to perform its intended function ("probable-to-complete recognition threshold"). Significant development uncertainty exists if the software involves technological innovations, novel or unproven features not yet resolved by coding/testing, or if performance requirements are not fully identified. During this period of uncertainty, costs are expensed as incurred. Capitalization ceases when the software project is substantially complete and ready for its intended use, which typically occurs after all substantial testing is completed.

Capitalized software costs are amortized on a straight-line basis over the estimated useful life of the related software once placed into service and amortized over the term of the hosting arrangement.

For the six months ended January 31, 2026, the Company capitalized $2,101,942 qualifying internal-use software development cost.