Company: DSWL
Filing Date: 2025-07-29
Form Type: 20-F
Source: 0001174947-25-001096
Chunk: 136

Company: DESWELL INDUSTRIES INC
Filing Date: 2025-07-29
Form: 20-F
Item: Item 18
Chunk 136
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 classified as trading securities and are stated at fair market value. Market value is determined by the most recently traded price of the security at the balance sheet date. Net realized and unrealized gains and losses on trading securities are included in non-operatingincome (expenses), net. The cost of investments sold is based on the average cost method. Dividend income earned are included in non-operatingincome (expenses), net.

Held-to-maturity investment - Our investments in U. S. Treasury Bills are classified as held-to-maturitybecause we have the positive intent and ability to hold the securities to maturity. We invest in U. S. Treasury Bills with maturities less than one year. Gross unrealized gains and losses are not material for any period presented. During the years ended March 31, 2023, 2024 and 2025, we recognized interest income on the investments of $ nil, $0.1million and $0.1million, respectively, which is included in non-operatingincome (expenses), net.

Inventories - Inventories are stated at the lower of cost or net realizable value. Cost is determined on the weighted average basis. Work-in-progressand finished goods inventories consist of raw materials, direct labor and overhead associated with the manufacturing process. The Company periodically performs an analysis of inventory to determine obsolete or slow-movinginventory and determine if its cost exceeds the estimated market value. Write down of potentially obsolete or slow-movinginventory are recorded based on management’s analysis of inventory levels.

Property, plant and equipment - Property, plant and equipment is stated at cost including the cost of improvements and cost incurred to bring the asset at place of work. Maintenance and repairs are charged to expense as incurred. Depreciation and amortization are provided on the straight line method based on the estimated useful lives of the assets as follows:

  Leasehold land and buildings           30 – 50 years                         
  Plant and machinery                    5 – 15 years                          
  Furniture, fixtures and equipment      4 – 5 years                           
  Motor vehicles                         3 – 5 years                           
  Leasehold improvements                 Shorter of lease term or 2 – 5 years  

Leases - The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use(“ ROU”) assets, other current liabilities and operating lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term, and lease

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