Company: NTCL
Filing Date: 2025-10-20
Form Type: F-1
Source: 0001104659-25-100526
Chunk: 317

Company: NetClass Technology Inc
Filing Date: 2025-10-20
Form: F-1
Chunk 317
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ortized initial direct costs, or impairment charges relating to the right-of-use-asset. Lease liabilities represent the Company’s obligation to make lease payments arising from the lease and are recognized at the present value of the future lease payments at the lease commencement date. As the interest rate implicit in most of the Company’s leases is not readily determinable, the Company uses the 5-year LPR interest rate stipulated by the People’s Bank of China (the “PBOC”) in China to determine the present value of the future lease payments. The Company’s lease terms include options to renew or terminate the lease when it is reasonably certain that it will exercise the option. Any lease with a term of 12 months or less is considered short-term. As permitted by ASC 842, short-term leases are excluded from the ROU asset and lease liabilities accounts on the consolidated balance sheets. Consistent with all other operating leases, short-term lease expenses are recorded on a straight-line basis over the lease term. Repayments of operating lease liabilities, variable lease payments, and short-term lease payments are classified as operating activities in the consolidated statements of cash flows. Value added tax (“VAT”), goods and services tax (“GST”) and consumption tax (“CT”) Revenue is the invoiced value of goods and services, net of VAT, GST or CT. The VAT is based on gross sales price and VAT rates range from 6% to 13%, depending on the type of products sold or service provided. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. Net VAT balance between input VAT and output VAT is recorded in taxes payable. All VAT returns filed by the Company’s subsidiaries in the PRC remain subject to examination by the tax authorities for five years from the date of filing. The GST is based on gross sales price and GST rates of 9% or exempted if the revenue is from exported services. Our Singapore subsidiary is allowed to offset input GST paid to suppliers against their output GST liabilities. Net GST balance between input GST and output GST is recorded in taxes payable. The CT is based on gross sales price and CT rates of 10%. Our Japanese subsidiary is allowed to offset input CT paid to suppliers against their output CT liabilities. Net CT balance between input CT and output CT is recorded in taxes payable. Government grant Government grants are recognized in other income, net or as a reduction of specific costs and expenses for which the grants are intended to compensate. Such amounts are recognized in the Consolidated