Company: SDAWW
Filing Date: 2025-02-04
Form Type: 6-K
Source: 0001213900-25-010076
Chunk: 6

Company: SunCar Technology Group Inc.
Filing Date: 2025-02-04
Form: 6-K
Chunk 6
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 instruments. The warrant liabilities were measured at fair value using unobservable inputs and categorized in Level
3 of the fair value hierarchy.

The Group’s non-financial assets, such as
software and equipment, would be measured at fair value only if they were determined to be impaired.

| (f). | Revenue recognition |

The Group’s revenues are mainly generated
from providing auto service, auto eInsurance service and technology service.

The Group recognizes revenue pursuant to ASC 606,
Revenue from Contracts with Customers (“ASC 606”). In accordance with ASC 606, revenues from contracts with customers are
recognized when control of the promised goods or services is transferred to the Group’s customers, in an amount that reflects the
consideration the Group expects to be entitled to in exchange for those goods or services, reduced by Value Added Tax (“VAT”).
To achieve the core principle of this standard, we applied the following five steps:

| 1. | Identification of the contract, or contracts, with the customer;                        |
| 2. | Identification of the performance obligations in the contract;                          |
| 3. | Determination of the transaction price;                                                 |
| 4. | Allocation of the transaction price to the performance obligations in the contract; and |
| 5. | Recognition of the revenue when, or as, a performance obligation is satisfied.          |

Auto service

The Group defines enterprise clients as the Group’s
customers and the Group sells auto service coupons to enterprise clients, which each coupon represents one specific auto service. There
are various service types including vehicle washing, waxing, maintenance, driving service and road assistance, and the Group only provides
one specific service among various service types for each specific service coupon. The Group identifies each specific service coupon as
a contract that establishes enforceable rights and obligations for each party. The Group charges the service fee at a fixed price per
service when the service is performed. For service coupons with limited duration, the Group either charges the service fee at a fixed
price per service when the service is performed or when the coupon expires, whether or not the service has been performed. The Group considers
each service coupon is a distinct service that is capable of providing a benefit to the customer on its own according to ASC 606-10-25-14(a).
Therefore, the Group identifies only one performance obligation under a contract, which is to provide a specific service or to stand-ready
to perform a specific service within a limited duration. The Group acts as a principal as