Company: XHG
Filing Date: 2025-01-22
Form Type: 20-F
Source: 0001213900-25-005499
Chunk: 207

Company: XChange TEC.INC
Filing Date: 2025-01-22
Form: 20-F
Item: Item 19
Chunk 207
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Diluted (losses) earnings per ordinary share reflects the potential
dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares.
Potential ordinary shares, including preferred shares, convertible notes, share options and warrants are excluded from the computation
in income periods should their effects be anti-dilutive. The Group had share options, convertible notes and warrants, which could potentially
dilute basic earnings per share in the future. To calculate the number of shares for diluted (losses) earnings per share, the effect of
the convertible redeemable and non-redeemable preferred shares, share options and warrants is computed using the two-class method or the
as-if converted method, whichever is more dilutive.

F-18

Treasury shares

The Group accounts for treasury shares using the cost method. Under
this method, the cost incurred to purchase the shares is recorded in the treasury shares account on the consolidated balance sheets. At
retirement of the treasury shares, the ordinary shares account is charged only for the aggregate par value of the shares. The excess of
the acquisition cost of treasury shares over the aggregate par value is allocated between additional paid-in capital (up to the amount
credited to the additional paid-in capital upon original issuance of the shares) and retained earnings.

For the year ended September 30, 2022, the Company reissued the77,100,000treasury shares to a third party which purchased and assumed the unpaid borrowings due to SHRB.

As of September 30, 2023 and 2024, the Group hadnotreasury shares.

Reclassification

Certain reclassifications have been made to the prior year’s
consolidated balance sheets to conform to the current year’s presentation. These reclassifications had no impact on net (loss) income,
shareholders’ deficit, or cash flows as previously reported.

Discontinued operations

In accordance with ASU No. 2014-08, Reporting Discontinued Operations
and Disclosures of Disposals of Components of an Entity, a disposal of a component of an entity or a group of components of an entity
is required to be reported as discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect
on an entity’s operations and financial results when the components of an entity meets the criteria in paragraph 205-20-45-1E to
be classified as held for sale. When all of the criteria to be