| PREPAYMENTS, DEPOSITS AND OTHER ASSETS, NET |
NOTE 4 – PREPAYMENTS, DEPOSITS AND OTHER ASSETS, NET Prepayments, deposits and other assets, net consisted of the following: | | | As of June 30, | | | | | 2026 | | | 2025 | | | Prepaid expenses* | | | 1,335,006 | | | | 1,106,119 | | | Contract assets | | | 698,006 | | | | 320,348 | | | Advances and deposits to suppliers* | | | 749,433 | | | | 756,241 | | | Deferred contract costs** | | | 3,228,991 | | | | 5,027,030 | | | Notes receivable*** | | | 1,653,526 | | | | 335,193 | | | Advances to employees | | | 743,160 | | | | 371,799 | | | Prepaid VAT | | | 49,143 | | | | 8,360 | | | Less: allowance for credit losses | | | (2,843 | ) | | | (1,764 | ) | | Total | | | 8,454,422 | | | | 7,923,326 | | | Less: non-current portion | | | (723,177 | ) | | | (481,761 | ) | | Prepayments, deposits and other assets – current portion | | | 7,731,245 | | | | 7,441,565 | | | * | Prepaid expenses, advances and deposits to suppliers primarily consist of advances and deposits to suppliers. | | ** | The Company recognized $1,707,324 of impairment loss on deferred contract costs for the year ended June 30, 2026. | | *** | Notes receivable represents accounts receivable due from various customers where the customers’ banks or customers have guaranteed the payments. The notes are non-interest bearing and normally paid within three to six months. The Company has the ability to submit request for payment to the customer’s bank earlier than the scheduled payment date, but will incur an interest charge and a processing fee. |
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