Notes:
Basis
of Preparation
The Directors of the Company are responsible for preparation of the Reconciliation Statement in accordance with the relevant requirements
of the Hong Kong Listing Rules and relevant guidance in HKEX-GL111-22. The Reconciliation Statement was prepared based on the Groups Unaudited Interim Financial Statements prepared under U.S. GAAP, with
adjustments made (if any) thereto in arriving at the unaudited financial information of the Group prepared under IFRS. The adjustments reflect the differences between the Groups accounting policies under U.S. GAAP and IFRS.
(i) Share-based compensation
Under U.S. GAAP, the Company has
elected to recognize compensation expense using the straight-line method for all employee equity awards granted with graded vesting over the requisite service period.
Under IFRS, the graded vesting method is required to recognize compensation expense for all employee equity awards granted with graded vesting.
(ii) Leases
Under U.S. GAAP, for operating leases, the
amortization of right-of-use assets and the interest expense element of lease liabilities are recorded together as lease expenses, which are measured on a straight-line
basis and are recorded in the consolidated statements of income/(loss).
Under IFRS, the
right-of-use assets are generally depreciated on a straight-line basis while the interest expense related to the lease liabilities are measured under the effective
interest method, which results in higher expenses at the beginning of the lease term and lower expenses near the end of the lease term.
(iii) Equity
securities without readily determinable fair values
Under U.S. GAAP, the Company elected to measure an equity security without a readily determinable fair
value using a measurement alternative that measures the securities at cost minus impairment, if any, plus or minus changes resulting from qualifying observable price changes.
Under IFRS, the Company measured the investments in equity instruments at fair value through profit or loss (FVTPL). Fair value changes of these investments
were recognized in the profit or loss.
(iv) Available-for-sale debt
investments
Under U.S. GAAP, the available-for-sale debt investments
classified within Level 3 are valued based on a model utilizing unobservable inputs which require significant management judgment and estimation. The Company reports
available-for-sale debt investments at fair value at each balance sheet date with the aggregate unrealized gains and losses, net of tax, reflected in Accumulated
other comprehensive loss in the consolidated balance sheets.
Under IFRS, since those investments could not meet the definition of the equity
instrument from the perspective of issuer, and the contractual cashflow could not pass the Solely Payments of Principal and Interest (the SPPI) test, thus they should be classified as financial assets measured at fair value through
profit or loss.
Additionally, when an investor has other financial interests, like preferred stock, in an associate or a joint venture, that in substance
form part of the net investment in the associate or the joint venture, after that the investors share of equity method losses reduces the basis of its common stock investment to zero, the investor should continue to recognize equity method
losses to the extent of, and as an adjustment to, the basis of preferred stock.
At all times, the preferred stock would require a write-up (or write-down) to fair value through income or through other comprehensive income, net of tax if any, under U.S. GAAP, which is not applicable under IFRS.
(v) Equity method investments
Under U.S. GAAP and IFRS, the
investor should adjust the results of its associate or joint venture to align the investees accounting policies with its own policies. The reconciliation items mainly arise from different accounting the associate or joint venture applied under
each GAAP.