Company: WCT
Filing Date: 2025-05-16
Form Type: 20-F
Source: 0001213900-25-044576
Chunk: 128

Company: Wellchange Holdings Co Ltd
Filing Date: 2025-05-16
Form: 20-F
Item: Item 19
Chunk 128
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 a closing price of HK$9.08 and HK$9.32 per share,
respectively.

Prepayment for acquisition of intangible assets

Prepayment for acquisition of intangible assets
is classified as non-current. The Company prepaid to the supplier for development and design of ERP software systems. The balances will
be recognized as an intangible asset upon the completion of development and design of the ERP software systems and merge with the existing
self-developed software, MR. CLOUD platform, for the subscription by customers.

Deferred offering costs

The Company follows the requirements of the FASB
ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“ SAB”) Topic 5A - “ Expenses of Offering”.
Deferred offering costs consist of underwriting, legal and other expenses incurred through the balance sheet date that are directly related
to the intended initial public offering (“ IPO”). Deferred offering costs will be charged to shareholders’ equity netted
against the proceeds upon the completion of the IPO. Should the IPO prove to be unsuccessful, these deferred offering costs, as well
as additional expenses to be incurred, will be charged to statements of income. As of December 31, 2023, the deferred offering costs
were US$680,090. Such costs will be deferred until the closing of the IPO, at which time the deferred costs will be offset against the
offering proceeds and recognized in equity of the Company for the December 31, 2024.

As of December 31, 2024, the deferred offering costs were US$620,193.
Such costs will be deferred until the closing of the placement, at which time the deferred costs will be offset against the placement
proceeds and recognized in equity of the Company

F-12

WELLCHANGE HOLDINGS COMPANY LIMITED

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
AND PRACTICES(cont.)

Fair value measurement

The accounting standard regarding fair value of
financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial
instruments held by the Company.

The accounting standard defines fair value, establishes
a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures.
The three levels are defined as follow:

  Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.                                                                     
  Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active