Company: XHG
Filing Date: 2025-01-22
Form Type: 20-F
Source: 0001213900-25-005499
Chunk: 198

Company: XChange TEC.INC
Filing Date: 2025-01-22
Form: 20-F
Item: Item 19
Chunk 198
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 Group are stated in RMB. Translations of balances in the consolidated
balance sheet, and the related consolidated statements of comprehensive income (loss), shareholders’ deficits and cash flows from
RMB into US dollars as of and for the year ended September 30, 2024 are solely for the convenience of the readers and were calculated
at the rate of USD1.00=RMB7.0176, representing the noon buying rate set forth in the H.10 statistical release of the U. S. Federal Reserve
Board on September 30, 2024. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled
into USD at that rate on September 30, 2024, or at any other rate.

F-13

Fair value

The Group defines fair value as the price that would be received from
selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining
the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal
or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the
asset or liability.

The established fair value hierarchy requires an entity to maximize
the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization
within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels
of inputs may be used to measure fair value include:

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices included within Level 1 that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Group’s financial instruments
include cash and cash equivalents, accounts receivable, amounts due to related parties, other
current assets, non-current restricted cash, accounts payable,