Company: CHOW
Filing Date: 2025-05-29
Form Type: F-1/A
Source: 0001641172-25-012773
Chunk: 193

Company: ChowChow Cloud International Holdings Ltd
Filing Date: 2025-05-29
Form: F-1/A
Chunk 193
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 providing services to customers.                                                                                                |

Costs are recognized as incurred in the same period as the related revenues, in accordance with ASC 606. The Company does not maintain inventory but purchases hardware and software upon receiving customer orders. Since the setup and delivery are typically completed within a short period, costs are classified as cost of revenues and expensed as incurred when control of the related products or services is transferred to the customer.

The Company has considered ASC 340-40 and determined that no costs meet the criteria for capitalization, as all costs are directly tied to performance obligations that are satisfied within the same reporting period.

Cost of Revenues Classification

The Company categorizes cost of revenues into cost of products and cost of services based on the final deliverable of the contract. Costs are tracked at the contract level and assigned to the appropriate category at the time of incurrence, ensuring they are directly attributed to either product or service costs based on the final deliverable.

The Company utilizes a direct cost assignment methodology, recording each cost in the relevant category as incurred, rather than aggregating all costs of revenue and allocating them proportionally based on revenue presentation methodology. This approach ensures that costs align with their respective performance obligations under each contract and accurately reflect the economic substance of the transaction.

The following table sets forth a breakdown of our costs of revenues, in absolute amounts and percentages of total revenues for the years ended December 31, 2023 and 2024:

|                                                                                      |     |                          For 
 the Years Ended December 31, |             |     |   |      |     |      |             |     |             |            |     |   |      |
|                                                                                      |     |                         2023 |             |     |   |      |     | 2024 |             |     |             |            |     |   |      |
|                                                                                      |     |                          HK$ |             |     | % |      |     |  HK$ |             |     | US$         
 (Note 2(e)) |            |     | % |      |
| Cost of Products:                                                                    |     |                              |             |     |   |      |     |      |             |     |             |            |     |   |      |
| Contracts                                                                            
 with Multiple Promises:                                                              |     |                              |             |     |   |      |     |      |             |     |             |            |     |   |      |
| -                                                                                    
 Sale of Hardware with IT Professional Services                                       |     |