Company: XHG
Filing Date: 2025-01-22
Form Type: 20-F
Source: 0001213900-25-005499
Chunk: 210

Company: XChange TEC.INC
Filing Date: 2025-01-22
Form: 20-F
Item: Item 19
Chunk 210
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 contractual transfer restrictions, the effective date aligns with the
date when the SEC removes the related disclosure from Regulation S-X or Regulation S-K. Early adoption is not allowed. For all other entities,
the amendments will be effective two years later from the date of the SEC’s removal.

In March 2023, the FASB issued new accounting
guidance, ASU 2023-01, for leasehold improvements associated with common control leases, which is effective for fiscal years beginning
after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted for both interim and annual
financial statements that have not yet been made available for issuance. The new guidance introduced two issues: terms and conditions
to be considered with leases between related parties under common control and accounting for leasehold improvements. The goals for the
new issues are to reduce the cost associated with implementing and applying Topic 842 and to promote diversity in practice by entities
within the scope when applying lease accounting requirements.

Recently issued ASUs by the FASB, except for the ones mentioned above,
have no material impact on the Company’s unaudited condensed consolidated statements of operations and comprehensive loss or consolidated
balance sheets.

Management does not believe that any other recently issued, but not
yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s financial statements.

  DISPOSITION                             

On October 31, 2023 and on September 12,2024, the Group transferred
of all of its equity interest in Haoju (Shanghai) Artificial Intelligence Technology Co., Ltd. (“ Q& K AI”) and QK365, FENGLINJU
PROPERTY (CHINA) LIMITED and Shanghai Meileju Intelligent Technology Co., Ltd, to Wangxiancai Limited, at nominal consideration (the “ Second
Equity Transfer”).

Upon the closing of the Second Equity Transfer, Wangxiancai Limited
became the sole shareholder of the Group’s long-term apartment rental business and as a result, assumed all assets and obligations
of Q& K AI, Q& K Investment Consulting and Q& K HK, and their subsidiaries, VIE and VIE’s subsidiaries. Upon the closing
of the transaction, the Group does not bear any contractual commitment or obligation to the long-term apartment rental business.

In accordance with ASU No. 2014-08, Reporting Discontinued Operations
and Disclosures of Disposals of Components of an Entity, a disposal