Company: GCL
Filing Date: 2025-04-03
Form Type: F-1
Source: 0001213900-25-028608
Chunk: 238

Company: GCL Global Holdings Ltd
Filing Date: 2025-04-03
Form: F-1
Chunk 238
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 that may affect the Company’s ability to collect
from customers. Under the new accounting guidance, the Company measures credit losses on its accounts receivable using the current expected
credit loss model under ASC 326. As of March 31, 2024 and 2023, the Company provided allowance for credit loss of $325,457 and $55,533,
respectively.

Inventories are stated at the lower of cost or net
realizable value. Weighted average method is the inventory valuation method applied to these inventories. Inventories mainly include physical
console game compact disc, gaming hardware and accessories which are purchased from the Company’s suppliers as merchandized goods.
Inventories are reviewed for potential write-down for estimated obsolescence or unmarketable inventories which equals the difference between
the costs of inventories and the estimated net realizable value based upon forecasts for future demand and market conditions. When inventories
are written down to net realizable value, it is not marked up subsequently based on changes in underlying facts and circumstances. For
the years ended March 31, 2024 and 2023, $468,941and $288,604 of inventories write-down were recorded, respectively.

<div align='center'>F-25

GCL GLOBAL LIMITED AND ITS SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</div>

Other receivables primarily include receivables
from the marketing expense related in promoting console game that the Company paid on behalf of vendors, and refundable deposit such as
rental deposit. Starting from April 1, 2021, the Company adopted ASC Topic 326 on its other receivables using the modified retrospective
approach. The new credit loss guidance replaces the old model for measuring the allowance for credit losses with a model that is based
on the expected losses rather than incurred losses. Under the new accounting guidance, the Company measures credit losses on its other
receivables using the current expected credit loss model under ASC 326. As of March 31, 2024 and 2023, the Company provided allowance
for credit loss of $52,949 and $3,747, respectively.

Prepayments are mainly cash deposited or advanced
to suppliers for future inventory purchases. These amounts are refundable if the purchases are not completed and bear no interest. For
any prepayments determined by management that such advances will not be in receipts of inventories, services, or refundable, the Company