Company: ILAG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001641172-25-006445
Chunk: 150

Company: Intelligent Living Application Group Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 150
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 effect on our ability to maintain
current levels of gross margin and operating expenses as a percentage of sales revenue if the revenues from our products do not increase
with such increased costs.

Interest rate risk

We are exposed to interest rate risk on our interest-bearing
assets and liabilities. As part of our asset and liability risk management, we review and take appropriate steps to manage our interest
rate exposures on our interest-bearing assets and liabilities. We have not been exposed to material risks due to changes in market interest
rates, and not used any derivative financial instruments to manage the interest risk exposure during the year ended December 31, 2024 and 2023.

Foreign currency translation and transaction

The Company’s reporting currency is the USD.
The functional currency of its Hong Kong subsidiaries is the Hong Kong dollar (the “ HKD”), and the functional currency of
its PRC subsidiary is the Renminbi (the “ RMB”). RMB is not freely convertible into foreign currencies for capital account
transactions. The value of RMB against the U. S. dollar and other currencies is affected by, among other things, changes in China’s
political and economic conditions and China’s foreign exchange policies. To date, we have not entered into any hedging transactions
in an effort to reduce our exposure to foreign currency exchange risk.

  ITEM 12.      DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES  
 ────────────────────────────────────────────────────────────────────────

A. Debt Securities

Not applicable.

B. Warrants and Rights

Not applicable.

C. Other Securities

Not applicable.

  90  

PART II