Company: STAK
Filing Date: 2025-11-05
Form Type: 20-F
Source: 0001493152-25-020818
Chunk: 97

Company: STAK Inc.
Filing Date: 2025-11-05
Form: 20-F
Item: Item 5
Chunk 97
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 ASU 2019-11, ASU 2020-02 and ASU 2020-03 (collectively, including ASU 2016-13, “ASC 326”). ASC 326 introduces an approach based on expected losses to estimate the allowance for credit losses, which replaces the previous incurred loss impairment model.
 
We evaluate our accounts receivable for expected credit losses on a regular basis. We maintain an estimated allowance for credit losses to reduce our accounts receivable to the amount that we believe will be collected. Our estimation of allowance for credit losses considers factors such as historical credit loss experience, age of receivable balances, current market conditions, reasonable and supportable forecasts of future economic conditions, as well as an assessment of receivables due from specific identifiable counterparties to determine whether these receivables are considered at risk or uncollectible. We adjust the allowance percentage periodically when there are significant differences between estimated credit losses and actual credit losses. If there is strong evidence indicating that the accounts receivable are likely to be unrecoverable, we also make specific allowance in the period in which a loss is determined to be probable. Accounts receivable balances are written off after all collection efforts have been exhausted.
 
There were $43,521, $93,218 and $97,526 provision for credit losses as of June 30, 2025, 2024 and 2023, respectively.
 
Revenue recognition
 
We adopted ASC Topic 606 Revenue from Contracts with Customers with a date of the initial application of July 1, 2021 using the modified retrospective method.
 
We generate revenues primarily from sales of specialized oilfield vehicles, sales of specialized oilfield equipment, automation solutions services and others. In accordance with Revenue from Contracts with Customers (“ASC 606”), revenues from contracts with customers are recognized when or as the control of the services or goods is transferred to the customer, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services net of business tax and value added tax. Revenue recognition policies for each type of revenue stream are as follows:
 
Sales of specialized oilfield vehicles and specialized oilfield equipment
 
We sell specialized oilfield vehicles and specialized oilfield equipment. We design and manufacture the specialized oilfield equipment and components of specialized oilfield vehicles. In addition, we also supply our core equipment and components then outsource them to qualified specialized vehicle manufacturing companies to integrate and produce specialized oilfield vehicles, and the final products are sold by us externally. We generate