Company: FOXX
Filing Date: 2025-10-15
Form Type: 10-K
Source: 0001213900-25-098953
Chunk: 740

Company: Foxx Development Holdings Inc.
Filing Date: 2025-10-15
Form: 10-K
Item: Item 3
Chunk 740
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 of the date of the
consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results could
differ from these estimates.

Fair
value measurement

The
accounting standard regarding the fair value of financial instruments and related fair value measurements defines financial instruments
and requires disclosure of the fair value of financial instruments held by the Company.

F-9

The
accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and
enhance disclosure requirements for fair value measures. The three levels are defined as follows:

    ●
    Level
    1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

    ●
    Level
    2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that
    are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.

    ●
    Level
    3 inputs to the valuation methodology are unobservable and significant to the fair value.

Financial
instruments included in current assets and current liabilities are reported in the balance sheets at face value or cost, which approximates
the fair value because of the short period of time between the origination of such instruments and their expected realization and their
current market rates of interest.

Foreign
currency translation and transactions

The
reporting currency of the Company is the U.S. dollar. The functional currency for our holding company is the U.S. dollar (“USD”).
In Singapore, the Company conducts its business in the local currency, Singapore dollar (“SGD”), as its functional currency.
Assets and liabilities are translated at the unified exchange rate as quoted by the Federal Reserve System at the end of the period.
The statements of operations and cash flows are translated at the average translation rates during the reporting periods and the equity
accounts are translated at historical rates. Translation adjustments resulting from this process are included in accumulated other comprehensive
loss. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the
functional currency are included in the results of operations as incurred.

Translation
adjustments are included in accumulated other comprehensive loss. The balance sheet amounts, with the exception of shareholder’s
equity (deficit) at June 30, 2025 were translated at SGD 1.27 to USD 1.00. The average translation rates applied to the consolidated
statements