Company: AOAO
Filing Date: 2025-02-24
Form Type: S-1/A
Source: 0001493152-25-008010
Chunk: 26

Company: Alpha One Inc.
Filing Date: 2025-02-24
Form: S-1/A
Chunk 26
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 and/or delay in settlement of accounts receivable from our customers which may impact its operating cash flow position

The Company relies on its suppliers to provide the necessary labour and materials for its projects, and relies upon the cash inflow from its customers to meet the payment obligations towards its suppliers. The Company’s cash inflows are dependent upon a variety of factors including certification by its customers and the prompt settlement of its invoices. If such payment is delayed, the Company may be required to fund the cost of works for a lengthy period of time until the Company’s payment application is approved and paid for. As at March 31, 2024 and 2023, the Company’s accounts payable, accrued and other payables amounted to $5.66 million and $2.80 million respectively. Whereas for the corresponding dates, the Company’s account receivables amount to $9.75 million and $5.72 million respectively. As at September 30, 2024, the Company’s accounts payable, accrued and other payables amounted to $5.63 million and the net accounts receivable amount to $9.63 million. Nevertheless, even if the Company’s customers settle such payments on time and in full, there can be no assurance that the Company would not experience any significant cash flow mismatch which would affect the Company’s operating cash flow position as the Company may be required to provide prepayments pursuant to the arrangement with its suppliers. For the years ended March 31, 2023 and 2024 and for the six months ended September 30, 2024, the Company would in certain circumstances, depending on the scale of works required, provide its material suppliers with an advance payment of approximately 30% of the contract value as stipulated in the work order. Hence, if the Company undertakes a large number of projects, it would pose significant pressure on its cash flow and the Company may record net operating cash outflow.

Due to uncertainty of the timing of collection, we established an allowance for doubtful accounts based on account analysis and historical collection trends. We established a provision for doubtful receivables when there is objective evidence that the Company may not be able to collect due amounts. The allowance is based on management’s best estimates of specific losses on the exposures and a provision on historical trends of collections. Based on the management of customers’ credit and ongoing relationship, management determines whether any balances outstanding at the end of the period will be deemed uncollectible, both on customer basis and through an aging analysis basis. Delinquent account