Company: CHOW
Filing Date: 2025-01-13
Form Type: DRS/A
Source: 0001493152-25-001833
Chunk: 85

Company: ChowChow Cloud International Holdings Ltd
Filing Date: 2025-01-13
Form: DRS/A
Chunk 85
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 More importantly, the Company does not have an enforceable right                                                                       
 to payment for performance completed to date. Engagement letters typically permit termination at any time without penalty, and payment 
 terms do not obligate the customer to pay for partially completed work.                                                                |

Accordingly, control is transferred to the customer at a point in time, and revenue is recognized at that time.

Contracts with Multiple Promises

Contracts with customers often contain multiple promises (e.g., hardware, software, and services). We evaluate each promised good or service in a contract to determine whether it is distinct in accordance with the criteria outlined in ASC 606-10-25-19 through 25-22.

A performance obligation is distinct if both of the following criteria are met:

| (i)  | The                                                                                            
 customer can benefit from the good or service either on its own or together with other readily 
 available resources.                                                                           |
| (ii) | The                                                                                            
 promise to transfer the good or service is separately identifiable from other promises in      
 the contract.                                                                                  |

The transaction price is allocated to each performance obligation based on their relative standalone selling prices (SSP). SSPs are determined using observable prices of goods or services when sold separately, or, when observable prices are not available, estimated using expected cost-plus margin approaches. Revenue for each performance obligation is recognized either at a point in time or over time, depending on when control of the performance obligation transfers to the customer.

Contract Scenarios with Multiple Promises

(i) Sale of Hardware Products with IT Professional Services (e.g., Setup, Development, Customization, or Integration Services)

| ● | Evaluation                                                                                                                                   
 of Distinctness: The Company evaluates whether the hardware and IT professional                                                              
 services (e.g., setup, development, customization) are distinct within the context of the                                                    
 contract. While the hardware may provide standalone functionality, the IT professional services                                              
 are highly interdependent and interrelated with the hardware to produce a combined output—a                                                  
 functional and integrated solution.                                                                                                          
 This assessment aligns with the principle in ASC                                                                                             
 606-10-25-21 and the guidance in BC32, which emphasizes that the evaluation of distinctness should consider the level of integration,        
 interrelation, and interdependence among promises in the context of a bundle of goods and services. The Company determined that the hardware 
 and IT professional services significantly affect each other’s utility to the customer, making them not separately identifiable.             
 The customization and integration services use the hardware as