Company: TOP
Filing Date: 2025-08-13
Form Type: 20-F
Source: 0001213900-25-075728
Chunk: 101

Company: TOP Financial Group Ltd
Filing Date: 2025-08-13
Form: 20-F
Item: Item 19
Chunk 101
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 held on behalf of customers.

Payables
to holders of structured notes

Payables
to holders of structured notes arise from the over-the-counter (OTC) derivatives business. The holders subscribed for structured notes
by depositing investment amount to the Company’s account. The payables to holders of structured notes represent outstanding payables
due to the holders of structured notes, which was calculated by the principal amount plus gains or minus losses arising from the investments
in OTC derivatives business.

F-13

TOP
Financial Group Limited

Notes
to Consolidated Financial Statements

For
the Years Ended March 31, 2025, 2024 and 2023

2.
Summary of Significant Accounting Policies (Continued)

Revenue
Recognition

  Revenue from Contracts  

ASC
606, Revenue from Contracts with Customers (“ ASC 606”) establishes principles for reporting information about the nature,
amount, timing and uncertainty of revenues and cash flows arising from the entity’s contracts to provide goods or services to customers.
The core principle requires an entity to recognize revenues to depict the transfer of goods or services to customers in an amount that
reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance
obligations are satisfied. In according with ASC 606, revenues are recognized when the Company satisfies the performance obligations
by delivering the promised services to the customers, in an amount that reflects the consideration the Company expects to be entitled
to in exchange for those services.

The
Company identified each distinct service as a performance obligation. The recognition and measurement of revenues is based on the assessment
of individual contract terms. The Company applied a practical expedient to expense costs as incurred for costs to obtain a contract with
a customer when the amortization period would have been one year or less. The Company has no material incremental costs of obtaining
contracts with customers that the Company expects the benefit of those costs to be longer than one year, which needs to be recognized
as assets.

Futures
brokerage commissions

The
Company earns fees and commissions from futures brokerage services based on a fixed rate for each transaction, all of which are
under the consolidated accounts where the customer information is not disclosed to the third-party brokers. When a customer executes
a futures transaction through the Company’s platform, futures brokerage commission is recognized upon the completion of this
transaction. Only a single performance obligation is identified for each futures trading transaction, and the performance obligation
is satisfied on the trade date because that is when the