Company: LHI
Filing Date: 2025-05-23
Form Type: F-1
Source: 0001213900-25-046955
Chunk: 132

Company: Living Homeopathy International Ltd.
Filing Date: 2025-05-23
Form: F-1
Chunk 132
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ROU assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The ROU asset also includes any lease payments made and initial direct costs incurred and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. For leases that have lease terms of 12 months or less and does not include a purchase option that is reasonably certain to exercise, the Company elected not to apply ASC 842 recognition requirements. Lease expenses for minimum lease payments are recognized on a straight-line basis over the lease term. Any lease with a term of 12 months or less is considered short-term.

Quantitative and Qualitative Disclosures about Market Risks

Credit risk

Our assets that are potentially subject to a significant concentration of credit risk mainly consist of cash and cash equivalents and other receivable and other current assets.

The Company believes that there is no significant
credit risk associated with cash in Hong Kong, which were held by reputable financial institutions in the jurisdiction where Living Homeopathy
Hong Kong is located. The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD500,000 (approximately $64,356) if
a bank, which an individual/a company deposits with, fails. As of September 30, 2024, March 31, 2024 and 2023, cash balance of $2,290,247,
$2,240,676 and $2,088,736 was maintained at financial institutions in Hong Kong and approximately $74,851, $74,866 and $137,902 was insured
by the Hong Kong Deposit Protection Board, respectively.

Other receivable and other current assets are subject to credit evaluations. An allowance, where applicable, is made for estimated unrecoverable amounts that have been determined by reference to past default experience and the current economic environment.

Interest rate risk

The Company is exposed to cash flow interest rate risk through the changes in interest rates related mainly to the Company’s bank borrowings and bank balances. The Company currently does not have any interest rate hedging policy in relation to fair value interest rate risk and cash flow interest rate risk. The directors monitor the Company’s exposures on an ongoing basis and will consider hedging the interest rate should the