Company: CHOW
Filing Date: 2025-02-28
Form Type: DRS/A
Source: 0001493152-25-008591
Chunk: 221

Company: ChowChow Cloud International Holdings Ltd
Filing Date: 2025-02-28
Form: DRS/A
Chunk 221
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 the cash flows, an impairment loss is recognized based on the difference between the carrying value and the fair value of the asset. For the years ended December 31, 2022, and 2023, no impairment indicators were identified, and no impairment losses were recognized.

Increase in property and equipment in 2023: The increase in property and equipment during 2023 is primarily related to the Company’s investments in new computer equipment and office furniture to support the expansion of its operations and infrastructure. These assets are considered to be essential for supporting the Company’s growth initiatives and providing services to customers.

10. INTANGIBLE ASSET, NET

The Company’s intangible asset consists of an information technology service management system, a computer software platform that is not an integral part of a computer-controlled machine. The intangible asset is capitalized at cost, which includes development costs paid to the system developer and other directly attributable costs of preparing the asset for its intended use.

Capitalization Criteria: Development costs are capitalized when they meet the criteria for recognition as an intangible asset under ASC 350. Specifically, only costs incurred during the application development stage are capitalized. Costs incurred to enhance or extend the performance of the asset beyond its original specifications are also capitalized if they meet the recognition criteria. Maintenance costs or costs incurred during the preliminary project stage are expensed as incurred.

Following initial recognition, the intangible asset is carried at cost less accumulated amortization and any accumulated impairment losses. The asset is amortized on a straight-line basis over its estimated useful life of 5 years, reflecting the period over which the Company expects to derive economic benefits from the asset.

As of December 31, 2022 and 2023, the balances of the intangible asset are as follows:

|                                                  |     | As of December 31, |           |     |      |           |   |     |                 |         |   |
|                                                  |     |               2022 |           |     | 2023 |           |   |     |                 |         |   |
|                                                  |     |                HK$ |           |     |  HK$ |           |   |     | US$ (Note 2(e)) |         |   |
| Information technology service management system |     |                    | 1,268,330 |     |      | 2,206,846 |   |     |                 | 282,929 |   |
|                                                  |     |                    | 1,268,330 |     |      |