Company: LICN
Filing Date: 2025-04-29
Form Type: 20-F
Source: 0001213900-25-036244
Chunk: 113

Company: Lichen International Ltd
Filing Date: 2025-04-29
Form: 20-F
Item: Item 19
Chunk 113
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 Ventures, over which it has significant influence but does not own a majority equity interest or otherwise control. Under the
equity method, the Group initially records the investments at cost and the difference between the cost of the equity investee and the
fair value of the underlying equity in the net assets of the equity investee is recognized as equity method goodwill, which is included
in the equity method investments on the consolidated balance sheets. The Group subsequently adjusts the carrying amount of the investments
to recognize its proportionate share of each equity investee’s net income or loss into earnings and cash distributions from investees,
after the date of investment. The Group evaluates the equity method investments for impairment under ASC 323. An impairment loss on the
equity method investments is recognized as “ Investment loss, net (including impairments)” in the consolidated statements of
operations and comprehensive loss when the decline in value is determined to be other-than-temporary.

Investments accounted for at fair value

In accordance with ASC 825, Financial Instruments,
for financial products with variable interest rates referenced to performance of underlying assets and with original maturities greater
than one year, the Group elected the fair value method at the date of initial recognition and carries these investments at fair value.
Changes in the fair value of these investments are reflected on the consolidated statements of operations and comprehensive loss as “ Investment
loss, net (including impairments)”.

F-13

Property and equipment

Property and equipment are stated at cost less
accumulated depreciation and impairment if any. Depreciation is computed using the straight-line method over the following estimated useful
lives.

                               Useful Life        Estimated  
  Building                     20 - 50 years              5  
  Motor vehicles               10 years                   5  
  Furniture and equipment      3 - 5 years                5  
  Office improvements          3 - 5 years                0  

The cost and related accumulated depreciation of assets sold or otherwise
retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of operations and comprehensive
(loss) income. Expenditures for maintenance and repairs are charged to earnings as incurred, while additions, renewals and betterments,
which are expected to extend the useful life of assets, are capitalized. The Company also re-evaluates the periods of depreciation to
determine whether subsequent events and circumstances warrant revised estimates of useful lives.

Intangible assets

Intangible assets consist primarily of software
acquired and customer relationship, which are stated