Company: CHOW
Filing Date: 2025-02-28
Form Type: DRS/A
Source: 0001493152-25-008591
Chunk: 240

Company: ChowChow Cloud International Holdings Ltd
Filing Date: 2025-02-28
Form: DRS/A
Chunk 240
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 risk characteristics, adjusted for expected changes in the macroeconomic environment and industry trends.

Management evaluates receivables based on factors such as the aging of receivables, historical collection patterns, and the customer’s ability to pay, as well as broader economic factors that may affect the collectability of receivables. Significant judgments include evaluating the impact of economic downturns, industry-specific risks, and other external factors on customer creditworthiness.

Receivables are written off against the allowance when all reasonable collection efforts have been exhausted and management determines that the likelihood of collection is remote. The timing of the write-off is based on specific criteria, including the length of time a receivable has been past due, customer bankruptcy, and other significant credit events.

| F-47 |

As of December 31, 2023 and June 30, 2024, the Company had an allowance for expected credit losses of HK$493,720 and HK723,248 (US$92,724), respectively.

(i) Contract Assets and Contract Liabilities

Contract assets represent the Company’s right to consideration in exchange for goods or services that have been transferred to the customer, but for which billing has not yet occurred under the terms of the contract. Contract assets are recognized when the Company satisfies a performance obligation and has a right to payment, but the payment is conditional on something other than the passage of time (e.g., future performance or acceptance of goods or services by the customer). Contract assets are evaluated for expected credit losses in accordance with ASC 326 and are measured at the net realizable value.

Contract liabilities represent the billings to date, as allowed under the terms of a contract, but not yet recognized as contract revenue using the Company’s revenue recognition policy. Contract liabilities arise when billings exceed the amount of revenue recognized based on the Company’s revenue recognition policy under ASC 606. Revenue is recognized over time or at a point in time as performance obligations are satisfied, depending on the nature of the contract and the specific terms of the agreement.

Contract assets and liabilities are classified as current or non-current depending on the timing of when the performance obligations are expected to be satisfied and when the related billings will occur. For contracts with multiple promises, the transaction price is allocated to each performance obligation based on relative stand-alone selling prices. The Company regularly reviews its estimates of transaction prices, performance obligations, and the progress toward satisfaction of those obligations.

Any significant changes in contract assets and liabilities are disclosed separately in the unaudited condensed consolidated financial statements and are primarily