|9 Months Ended|
Sep. 30, 2020
|Subsequent Events [Abstract]|
NOTE 16 —Subsequent Events
Sonim Technologies (Shenzhen) Limited (“
Sonim China”) was notified of a tax inquiry for the 2017 to 2019 tax years by the Shenzhen Tax Bureau Bao’an Branch of the State Administration of Taxation (the “China Tax Authority”) in June 2020 and resolved the tax inquiry with the China Tax Authority in October 2020. Sonim China paid RMB 644,498 of additional China taxes for the 2013 to 2019 years as a result of this inquiry, which was equal to USD $95 of additional tax using the FX rate at September 30, 2020. Because Sonim China had more than $1.4 million of non-current income tax payable as of December 2019 for the 2017 to 2019 years, no additional tax accrual is needed with respect to the additional China tax paid as a result of the China tax inquiry.
On October 9, 2020, payment was made to the China tax authority for $95. This is considered an effective settlement and as such no future further reassessments will occur for those years. Based on this review, the Company has concluded that there has been an effective settlement and will have a $1,981 of a net tax benefit in the fourth quarter of 2020.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef