Company: JL
Filing Date: 2025-07-28
Form Type: 20-F
Source: 0001213900-25-068049
Chunk: 170

Company: J-Long Group Ltd
Filing Date: 2025-07-28
Form: 20-F
Item: Item 11
Chunk 170
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ITEM
11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Credit
Risk

Credit
risk relates to the risk that the counterparty to a financial instrument would fail to discharge its obligations under the terms of the
financial instrument and cause a financial loss to us.

Bank deposits are only placed with creditworthy financial institutions.
Management does not expect any financial institutions will fail to meet their obligations resulting in material credit losses to us. Credit
risks associated with account receivables, deposits and prepayment are typically accounted for by creating an allowance for expected credit
losses. Credit risks are mitigated by performing ongoing credit evaluations of customers' financial condition. We have adopted a credit
policy of dealing with creditworthy counterparties to mitigate the credit risk from defaults. We estimate the allowance balance using
relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable
and supportable forecasts. Historical credit loss experience provides the basis for the estimation of expected credit losses.

In
respect of our investment in marketable debt securities, which are exposed to the securities issuers’ risk of default in paying
coupons on time or at all, we regularly monitor the financial conditions of the debt securities issuers and any change in their credit
ratings to make further investment decisions.

Our exposure to credit risk
is influenced mainly by the individual characteristics of each customer rather than the industry or country in which the customer operates
and therefore significant concentrations of credit risk primarily arise when we have significant exposure to individual customers. As
of March 31, 2024 and 2025, 32% and 24%, respectively, of our total accounts receivable were due from our five largest customers.

Currency
Risk

Currency risk refers to the risk that the fair value or future cash
flows of a financial instrument will fluctuate because of changes in foreign exchange rate. Our exposure to currency risk arises primarily
from cash and cash equivalents, restricted cash, investment in marketable debt securities, accounts receivable and accounts payable, which
are primarily denominated in Hong Kong dollars, US dollars, Renminbi and VND. Our reporting currency is US dollars.

As the Hong Kong dollar is pegged to the US dollar and although
Renminbi gradually depreciated against the US dollar over the three years ended March 31, 2025, and the exchange rate of the VND against
the US dollar has also experienced fluctuations over the year ended March 31,