Company: GRAN
Filing Date: 2025-07-01
Form Type: 424B4
Source: 0001213900-25-060039
Chunk: 251

Company: Grande Group Ltd/HK
Filing Date: 2025-07-01
Form: 424B4
Chunk 251
---
 interrelated and therefore, in accordance with ASC 606 -10-25-21(c), these services also fail to satisfy the criterion in ASC 606 -10-25-19 (b)of being distinct from one another within the context of the contract. Therefore, the Company accounts for all of the sponsorship services promised in the contract as a single performance obligation. Following the fact pattern provided, the sponsorship services does not meet criterion ASC 606 -10-25-27(a) because the listing applicant does not simultaneously receive and consume the benefits provided by the sponsor’s performance during the IPO process. The listing applicant only receives the benefits when the sponsor completes all of its services and the shares are successfully listed on the Hong Kong Exchange or another outcome. Applying paragraph 3A.18 of the Main Board Listing Rules of Hong Kong, “for the avoidance of doubt, a replacement sponsor shall not be regarded as having satisfied any of the obligations of a sponsor by virtue of work performed by a predecessor sponsor”, thus the performance obligation does not meet the condition in ASC 606 -10-55-6to be considered satisfied over time because a replacement sponsor would need to substantially re -performall of the work performed by the existing sponsor, including reperformance of the due diligence work and coordination with other professional parties. Even if some of the work done by other professional parties (such as lawyers and auditors) has been completed, this work is not part of the role of the sponsor. The sponsor will still need to coordinate with other professional parties and perform its own due diligence on the information provided by these parties. The sponsorship services also do not meet criterion ASC 606 -10-25-27(b) because there is no asset controlled by the listing applicant during the period. The agreements do not have a right to payment clause. The initial deposit normally only represents 24% in average of the total contract price and so it is not sufficient to cover the Company’s estimated costs incurred during the period before the achievement of the next milestone as specified in the service agreements. Consequently, the Company does not have an enforceable right to payment for its performance completed to date under these agreements and thus criterion ASC 606 -10-25-27(c) is not met. As a result, the services fee income is recognized at the point in time when the Company completes its sponsorship services. Underwriting and placing services The Company enters into the same agreement with the IPO services with its customers for underwriting syndicates for certain of those IPOs that the Company acted as