Company: ZLAB
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001628280-25-008409
Chunk: 36

Company: Zai Lab Ltd
Filing Date: 2025-02-27
Form: 10-K
Item: Item 16
Chunk 36
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 that are potentially subject to significant concentration of credit risk consist of cash and cash equivalents, restricted cash, short-term investments, accounts receivable, and notes receivable. As of December 31, 2024 and 2023, all of the Company’s cash and cash equivalents and short-term investments were held by major financial institutions located in mainland China and international financial institutions outside of mainland China which management believes are of high credit quality and continually monitors the credit worthiness of these financial institutions.Accounts receivable are typically unsecured and are derived from product sales. The Company manages credit risk of accounts receivable through ongoing monitoring of outstanding balances and limits the amount of credit extended based upon payment history and credit worthiness. Historically, the Company has collected receivables from customers within the credit terms with no significant credit losses incurred. One customer accounted for 10% or more of accounts receivable, with $16.7 million and $7.8 million as of December 31, 2024 and 2023, respectively.  Certain accounts receivable balances may be settled in the form of notes receivable. As of December 31, 2024, notes receivable represented bank acceptance promissory notes that are non-interest bearing and due within six months. Notes receivable were used to collect the receivables based on an administrative convenience, given these notes are readily convertible to be known amounts of cash. In accordance with the sales agreements, whether to use cash or bank acceptance 

F-18

Zai Lab LimitedNotes to the Consolidated Financial StatementsFor the Years Ended December 31, 2024, 2023, and 2022

promissory notes to settle the receivables is at the Company’s discretion, and this selection does not impact the agreed contractual purchase prices. The Company’s other receivables were primarily due from its partners, which have good credit ratings. The credit risk for other receivables was generally very low. Foreign Currency Risk RMB is not a freely convertible currency. The State Administration of Foreign Exchange, under the authority of the People’s Bank of China, controls the conversion of RMB into foreign currencies. The value of RMB is subject to changes in central government policies and to international economic and political developments affecting supply and demand in the China Foreign Exchange Trading System market. The cash and cash equivalents of the Company included aggregated amounts denominated in RMB of $19.0 million and $25.1 million, as of December 31, 2024 and