Company: MEGL
Filing Date: 2025-04-14
Form Type: 20-F
Source: 0001641172-25-004566
Chunk: 127

Company: Magic Empire Global Ltd
Filing Date: 2025-04-14
Form: 20-F
Item: Item 19
Chunk 127
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 and changes in the Group’s
collection trends. The Group estimates the expected credit losses for accounts receivables with similar risk characteristics on a pool
basis. For each pool, the Group first estimates its recovery period based on relevant historical accounts receivables collection information.
Then the Group estimates the credit allowances based on the recovery period, the historical distribution of each aging bucket, and the
impact of macroeconomic factors. Accounts receivables are written off when there is no reasonable expectation of recovery. Subsequent recoveries
of amounts previously written off are credited against the same line item. As of December 31, 2024 and 2023, the allowance for credit
losses was nil.

Deposits
and prepayments

Deposits
and prepayments are classified as either current or non-current based on the terms of the respective agreements. These advances are unsecured
and are reviewed periodically to determine whether their carrying value has become impaired. As of December 31, 2024 and 2023, management
believes that the Group’s prepayments and deposits are not impaired.

Property
and equipment, net

Property
and equipment are stated at cost less accumulated depreciation and impairment if applicable. The Group computes depreciation using the
straight-line method over the estimated useful lives of the assets as follows:

SCHEDULE
OF USEFUL LIVES OF PROPERTY AND EQUIPMENT

  Office            1 – 3 years                                             
  Furniture         3 years                                                 
  Motor             5 years                                                 
  Leasehold         Over                                                    

The
cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is
included in the consolidated statements of operations. Expenditures for maintenance and repairs are charged to earnings as incurred,
while additions, renewals and betterments, which are expected to extend the useful life of assets, are capitalized. The Group also re-evaluates
the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful lives.

Impairment
of long-lived assets

The
Group evaluates the recoverability of its long-lived assets (asset groups), including property and equipment and operating lease right-of-use
assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of its asset (asset group) may not
be fully recoverable. When these events occur, the Group measures impairment by comparing the carrying amount of the assets to the estimated
undiscounted future cash flows expected to result from the use