Company: SDAWW
Filing Date: 2025-12-22
Form Type: 6-K
Source: 0001213900-25-124170
Chunk: 5

Company: SunCar Technology Group Inc.
Filing Date: 2025-12-22
Form: 6-K
Chunk 5
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 required to replace an asset.

Financial assets and liabilities of the Group
primarily consist of cash, accounts receivable, short-term investments, other receivables included in prepayments and other current assets,
long-term investment, short-term borrowings, accounts payable, other payables included in accrued expenses and other current liabilities,
and warrant liabilities. As of December 31, 2024 and September 30, 2025, the carrying amounts of other financial instruments approximated
to their fair values due to the short-term maturity of these instruments. The warrant liabilities were measured at fair value using unobservable
inputs and categorized in Level 3 of the fair value hierarchy.

The Group’s non-financial assets, such as
property, software and equipment, would be measured at fair value only if they were determined to be impaired.

| (f). | Revenue recognition |

The Group’s revenues are mainly generated
from providing auto eInsurance service, technology service and auto service.

The Group recognizes revenue pursuant to ASC 606,
Revenue from Contracts with Customers (“ASC 606”). In accordance with ASC 606, revenues from contracts with customers are
recognized when control of the promised goods or services is transferred to the Group’s customers, in an amount that reflects the
consideration the Group expects to be entitled to in exchange for those goods or services, reduced by Value Added Tax (“VAT”).
To achieve the core principle of this standard, we applied the following five steps:

| 1. | Identification of the contract, or contracts, with the customer;                        |
| 2. | Identification of the performance obligations in the contract;                          |
| 3. | Determination of the transaction price;                                                 |
| 4. | Allocation of the transaction price to the performance obligations in the contract; and |
| 5. | Recognition of the revenue when, or as, a performance obligation is satisfied.          |

Auto eInsurance Service

The Group provides auto eInsurance service distributing
primarily vehicle insurance on behalf of the insurance companies and charges insurance companies for intermediation service commissions.
The commissions are determined as a percentage of premiums paid by the insured. Auto eInsurance services are considered to be rendered
and completed, and revenue is recognized, at the time an insurance policy becomes effective, that is, when the signed insurance policy
is in place and the premium is collected from the insured. The Group has satisfied the performance obligation to recognize revenue when
the premiums are collected by the respective insurance companies and not before, because collect