Annual Report 2025

NOTESTOTHE CONSOLIDATED FINANCIAL STATEMENTS For the year ended 31 December 2025 81 The United Laboratories International Holdings Limited Annual Report 2025 4. KEY SOURCES OF ESTIMATION UNCERTAINTY In the application of the Group’s accounting policies, the directors of the Company are required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and underlying assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. Key sources of estimation uncertainty The following is the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that may have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year. Provision of ECL for trade receivables The Group estimates the ECL on trade receivables using a provision matrix. During the years ended 31 December 2025 and 2024, the loss rates for the trade receivables are estimated based on historical credit loss experience, adjusted for forward-looking factors specific to the debtor’s industry and the macroeconomic environment. At every reporting date, all available historical observed default rates are reassessed and changes in the forward-looking information are considered. The provision of ECL is sensitive to changes in estimates. The information about the ECL and the Group’s trade receivables is disclosed in Notes 37 and 23, respectively.