Company: SCAG
Filing Date: 2025-11-12
Form Type: 20-F
Source: 0001213900-25-109190
Chunk: 200

Company: Scage Future
Filing Date: 2025-11-12
Form: 20-F
Item: Item 19
Chunk 200
---
 recognition  

The
Group generates revenues from the sales of NEVs and components, provision of vehicle modification services, leasing of NEVs, and others.

The
core principle of the guidance requires an entity to recognize revenue to depict the transfer of promised goods or services to customers
in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve
that core principle, an entity should apply these five steps:

Step
1: Identify the contract with the customer

Step
2: Identify the performance obligations in the contract

Step
3: Determine the transaction price

Step
4: Allocate the transaction price to the performance obligations in the contract

Step
5: Recognize revenue when the company satisfies a performance obligation

  (i)      Revenues                               

The
Group sells NEVs and related components to its customers. There are three types of contracts for sales of NEVs and components, including:
1) type i contract for supplies of standard NEVs only, 2) type ii contract for supplies of components only, and 3) type iii contract
for supplies of both NEVs and components.

The
Group determines whether arrangements are distinct based on whether the customer can benefit from the product or service on its own or
together with other resources that are readily available and whether the Group’s commitment to transfer the product or service
to the customer is separately identifiable from other obligations in the contract.

The
Group has identified a single performance obligation for type i and ii contracts, and identified two separate performance obligations
for the type iii contracts with supplies of both NEVs and components. For contracts with multiple performance obligations, the Group
allocates the contract price to each distinct performance obligation based on its identifiable standalone selling price. The Group recognizes
revenue at a point of time when the Group satisfies the performance obligations to transfer the NEVs and/or components to the designated
place.

The
Group considers itself the principal as it is primarily responsible for fulfilling the promise of providing the products, establishing
the transaction price with customers and bearing the inventory risk before the control of products are transferred. Therefore, such revenues
are reported on a gross basis. For certain components purchased on behalf of the customer from the designated vendor, the corresponding
revenues are reported on a net basis.

In
alignment with industry standards, the Group provides warranty coverage for its range of NEV and components, ensuring their operational
integrity and reliability. Warranty periods are determined based on the specific product sold