Company: JL
Filing Date: 2025-07-28
Form Type: 20-F
Source: 0001213900-25-068049
Chunk: 198

Company: J-Long Group Ltd
Filing Date: 2025-07-28
Form: 20-F
Item: Item 18
Chunk 198
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 has been incurred and the amount of
the assessment can be reasonably estimated.

If the assessment of a contingency
indicates that it is probable that a material loss is incurred and the amount of the liability can be estimated, then the estimated liability
is accrued in the Company’s financial statements. If the assessment indicates that a potentially material loss contingency is not
probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with
an estimate of the range of possible loss, if determinable and material, would be disclosed.

Loss contingencies considered
remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed.

Revenue recognition

The Company complies with
ASC Topic 606, “ Revenue from Contracts with Customers” (“ ASC Topic 606”) for revenue recognition. Based on the
requirements of ASC Topic 606, revenue is recognized when control of the promised goods or services is transferred to the customers
in an amount that reflects the consideration the Company expects to be entitled to receive in exchange for those goods or services. The Company offers reflective and non-reflective garment trims to its customers, including heat transfers, fabrics, woven labels and tapes,
sewing badges, piping, zipper pulls, and drawcords. Revenue is recognized when
the following 5-step revenue recognition criteria are met:

  Identify                      

  Identify the performance     

F-15

J-LONG GROUP LIMITED

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(cont.)

  Determine the transaction  

  Allocate the transaction  

  Recognize revenue when                               

Revenue from product sales
is recognized at the point in time control of the products is transferred, generally upon customer receipt based upon the standard contract
terms. Shipping and handling activities are considered to be fulfillment activities rather than promised services and are not, therefore,
considered to be separate performance obligations. Contract shipping terms include ExWorks (“ EXW”), FOB (Free on Board), CNF/CFR
(cost & freight), CIF (cost, insurance and freight) and DAP (delivered at place) price term. Under EXW (meaning the seller fulfills
its obligation to deliver when it makes goods available at its premises for the buyer to collect), the performance obligation is satisfied,
and control is transferred at the point when the customer is notified that their order is available for pickup. Under “ FOB”,
the control is transferred to the customer at the time the goods are