NOTES TO THE FINANCIAL STATEMENTS For the Financial Year Ended 31 December 2025 (cont’d) 2. BASIS OF PREPARATION (CONT’D) (c) Significant accounting judgements, estimates and assumptions (cont’d) Key sources of estimation uncertainty (cont’d) Deferred tax assets Deferred tax assets are recognised for all unused business losses, unabsorbed capital allowances and other deductible temporary differences to the extent that it is probable that taxable profit will be available against which the unused business losses, unabsorbed capital allowances and other deductible temporary differences can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of future taxable profits together with future tax planning strategies. The carrying value of unrecognised deferred tax assets are disclosed in Note 35 to the financial statements. Fair value of digital assets Digital assets (including Ethereum, Bitcoin, Tether USDt and other stable coins) are measured at fair value using the quoted price in United States Dollar (“USD”) from a number of different sources at closing Coordinated Universal Time. The Group considers this fair value to be a Level 1 input under the MFRS 13 Fair Value Measurement fair value hierarchy as the price on the quoted price (unadjusted) in an active market for identical assets. The Group uses a number of exchanges in order to provide the Group with appropriate size and liquidity to provide reliable evidence of fair value for the size and volume of transactions that are reasonably contemplated by the Group. Inventories valuation Inventories are measured at the lower of cost and net realisable value. The Group estimates the net realisable value of inventories based on an assessment of expected selling prices. Demand levels and pricing competition could change from time to time. If such factors result in an adverse effect on the Group’s products, the Group might be required to reduce the value of its inventories. Details of inventories are disclosed in Note 13 to the financial statements. Determination of transaction prices The Group and the Company are required to determine the transaction price in respect of each of its contracts with customers. In making such judgment the Group and the Company assess the impact of any variable consideration in the contract due to discounts or penalties in the contract. The Group’s credit sales provide its customers with a significant benefit of financing the goods and services sold. Where the period between the transfer of control of good and service to a customer and payment by the customer exceeds a year, the Group adjusts the transaction price with its customer and recognises a financing component. Significant judgements are used to estimate the discount rate applied in adjusting the transaction price of credit sales, the Group uses a discount rate that would reflect that of a separate financing transaction between the Group and its customer at contract inception. In making these estimates, management evaluated, among other factors, the difference between the amount of promised consideration and the cash selling price, the duration of the financing provided and market observable borrowing rates. 216
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