Company: GVH
Filing Date: 2025-02-12
Form Type: 20-F
Source: 0001493152-25-006117
Chunk: 164

Company: Globavend Holdings Ltd
Filing Date: 2025-02-12
Form: 20-F
Item: Item 3
Chunk 164
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 obligation to extend credit, unless that obligation is unconditionally cancellable by us. Assets that potentially subject
the Company to a significant concentration of credit risk primarily consist of cash, accounts receivable, deposits and prepayment
and contract assets. The Company has designed their credit policies with an objective to minimize their exposure to credit risk.

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Our exposure to credit
risk, which will cause a financial loss to us due to failure to discharge an obligation by the counterparties, relates primarily to our
bank deposits (including our own cash at banks), accounts receivable, deposits and prepayment and contract assets. We consider the maximum exposure to credit risk equals to the carrying amount of these financial assets in the
consolidated statement of financial position. As of September 30, 2024, the cash balance of $2,296,462 was substantially maintained at
financial institutions in Hong Kong.

We believe that there
is no significant credit risk associated with cash, which was held by reputable financial institutions in the jurisdictions where we
and our subsidiaries are located.

Credit risks associated
with account receivables, deposits and prepayment and contract assets are typically accounted for by creating an allowance for
expected credit losses. Credit risks are mitigated by performing ongoing credit evaluations of customers’ financial condition.
We have adopted a credit policy of dealing with creditworthy counterparties to mitigate the credit risk from defaults. We estimate the
allowance balance using relevant available information, from internal and external sources, relating to past events, current conditions,
and reasonable and supportable forecasts. Historical credit loss experience provides the basis for the estimation of expected credit
losses. Adjustments to historical loss information are made for differences in current risk characteristics.

Foreign Currency Risk

We are a global provider
of integrated cross-border logistics services and air freight forwarding services and our functional currency is the Hong Kong dollars.
Most of our transactions during the periods presented in this annual report are denominated in Hong Kong dollars, Australian dollars
and New Zealand dollars. Historically, our principal exposure to foreign currency fluctuations is mainly with respect to our expenses
incurred denominated in Australian dollars and New Zealand dollars. For the years ended September 30, 2022, 2023 and 2024, we incurred
approximately 47.7%, 54.3% and 62.0% of our cost of revenue, respectively, denominated in foreign currencies for customs clearance fees
and local courier expenses. We do not use currency exchange