1. The company's Allowance for Expected Credit Losses is based on an analysis of the aged accounts receivable. In 2022, the Allowance was calculated based on historic percentages (Appendix IV). For 2023, Management believes the hiring of Josephine Smith the new credit manager will reduce the percentages of uncollectible accounts by 5% foreachcategoryof 90 daysandlessand 10% foreachcategoryover 90 days. These expected improvements have not yet been reflected in the year end Allowance for Expected Credit Losses. APPENDIX IV AGED ACCOUNTS RECEIVABLE ANALYSIS ner 21 Tn Doing af Arrounte Rereiuahle Dec 31, 2023 Aging of Accounts Receivable 7 During the year, the Company wrote off $300,000 of uncollectible accounts. Of this amount, $180,000 was subsequently collected and recognized as a gain on the reversal of impairment. Bad debt expense of $507,100 was recorded as a loss on impairment during the year. Collection of Accounts Receivable will continue to be done by the Corporate office and is not considered a divisional responsibility