Annual Report 2024

NOTESTOTHE CONSOLIDATED FINANCIAL STATEMENTS For the year ended 31 December 2024 136 The United Laboratories International Holdings Limited Annual Report 2024 39. FINANCIAL INSTRUMENTS (Continued) Financial risk management objectives and policies (Continued) Credit risk and impairment assessment (Continued) Notes: (Continued) (3) As at 31 December 2024, a principal amount of RMB38,547,000 (2023:nil) has been due but not yet received by the Group. During the current year, the debtor has failed to settle the receivables under the repayment schedule, which is mutually agreed by the Group and the debtor. After considering various factors, including but not limited to potential transaction cost of recovering the trade receivables as well as the financial position and the credit risk of the debtor, the management considers that there is evidence that the debtor is in severe financial difficulty and the Group has no realistic prospect of recovery and therefore entire amount due from this debtor has been written off during current year. (4) As at 31 December 2024, principal amount of RMB343,000,000 (2023: RMB343,000,000) has been due but not yet received by the Group. Based on the legal opinion from the PRC lawyer, who is independent and not connected to the Group, the Group can initiate a litigation against Evergrande Chengdu to recover the consideration receivables, after considering various factors, including but not limited to the recoverable amount of the underlying assets, potential transaction cost of recovering the consideration receivables as well as the financial position and the credit risk of Evergrande Chengdu, the management considers that there is evidence that the consideration receivables is credit-impaired. As at 31 December 2024, after taking into consideration of probability of recovery of the consideration receivables (see Note 10 for details), the management of the Group is of the opinion that no reversal of impairment loss is recognised during the year ended 31 December 2024. During the current year, an impairment loss of RMB13,124,000 (2023: RMB12,346,000) has been recognised and amount of RMB12,417,000 (2023: RMB6,726,000) has been reversed for trade receivables, based on the provision matrix.