Company: EJH
Filing Date: 2025-10-30
Form Type: 20-F
Source: 0001213900-25-104179
Chunk: 189

Company: E-Home Household Service Holdings Ltd
Filing Date: 2025-10-30
Form: 20-F
Item: Item 19
Chunk 189
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 recoverable. Long-lived assets with
carrying values that are not expected to be recovered through future cash flows are written down to their estimated fair values. The carrying
value of a long-lived asset is deemed not recoverable if it exceeds the sum of undiscounted cash flows expected to result from the use
and eventual disposition of the asset. If the asset’s carrying value exceeds the sum of its undiscounted cash flows, a non-cash
asset impairment charges equal to the excess of the asset’s carrying value over its estimated fair value is recorded. Fair value
is defined as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market
participants at a specified measurement date. The Company measures fair value using market price indicators or, in the absence of such
data, appropriate valuation technique.

Contract liabilities

Contract liabilities represent the Company’s
obligation to transfer goods or services to a customer for which the Company has received consideration, or an amount of consideration
is due from the customer. The Company recognizes contract liabilities when it receives payments from customers before the related performance
obligation is satisfied.

Contract liabilities are recognized at the earlier
of when the related revenue is recognized or when payments are received in advance of performance. Upon satisfying the performance obligations,
the Company recognizes the revenue and reduces the contract liabilities balance.

Leases

From July 1, 2018, the Group adopted Accounting Standards Update (“ ASU”)
2016-02, Lease (FASB ASC Topic 842). The adoption of Topic 842 resulted in the presentation of operating lease right-of-use (“ ROU”)
assets and operating lease liabilities on the consolidated balance sheet. The Group has elected the package of practical expedients, which
allows the Group not to reassess (1) whether any expired or existing contracts as of the adoption date are or contain a lease, (2) lease
classification for any expired or existing leases as of the adoption date and (3) initial direct costs for any expired or existing leases
as of the adoption date. Lastly, the Group elected the short-term lease exemption for all contracts with lease terms of 12 months or less.

At inception of a contract,
the Group assesses whether a contract is, or contains, a lease. A contract is or contains a lease if it conveys the right to control the
use of an identified asset for a period of time in exchange of a consideration. To assess whether a contract is or contains a