Company: WCT
Filing Date: 2025-05-16
Form Type: 20-F
Source: 0001213900-25-044576
Chunk: 123

Company: Wellchange Holdings Co Ltd
Filing Date: 2025-05-16
Form: 20-F
Item: Item 19
Chunk 123
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 among the Company and its subsidiaries have been eliminated
upon consolidation.

Use of estimates and assumptions

The preparation of consolidated financial statements
in conformity with U. S. GAAP requires management to make judgements, estimates and assumptions that affect the application of policies
and reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as at the date of the consolidated
financial statements and reported amounts of income and expenses during the reporting periods. The estimates and associated assumptions
are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of
which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other
sources. Significant accounting estimates reflected in the consolidated financial statements include allowance for expected credit losses,
the useful lives of property and equipment and intangible assets, impairment assessment of property and equipment and intangible assets
and interest rate of lease. Actual results may differ from these estimates.

F-9

WELLCHANGE HOLDINGS COMPANY LIMITED

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
AND PRACTICES(cont.)

Foreign currency translation and transaction

The Group uses United States Dollar (“ US$”)
as reporting currency. The functional currency of the Company and its subsidiary incorporated in the Cayman Islands and BVI is US$ and
the functional currency of its Hong Kong subsidiary is Hong Kong Dollar (“ HK$”). The determination of the respective
functional currency is based on the criteria of Accounting Standards Codification (“ ASC”) Topic 830, “ Foreign
Currency Matters”.

In the consolidated financial statements of the
Company, transactions in currencies other than the functional currency are measured and recorded in the functional currency using the
exchange rate in effect at the date of the transaction. At the balance sheet date, monetary assets and liabilities that are denominated
in currencies other than the functional currency are translated into the functional currency using the exchange rate at the balance sheet
date. All gains and losses arising from foreign currency transactions are recorded in the statements of operations and comprehensive income
during the year in which they occur.

Convenience translation

The functional currency is US$ for the Company’s
Cayman Islands and BVI operations and HK$ for Hong Kong subsidiary operations. The Company’s reporting currency is the U. S. dollar.
Assets and liabilities denominated in foreign currencies are translated at year-end exchange rates, statements of income accounts are
translated at average rates of exchange for the year and equity is translated at historical exchange rates. Any translation