Cloopen Group Holding Ltd (RAASY) – Company response
2025-11-21 · Re: · Accession 0001493152-25-024545 · Responded
ASC 606: Principal vs. AgentASC 606: Revenue RecognitionNon-GAAP: Adjustments & LabelsNon-GAAP: Reconciliation & UsefulnessDebt, Equity & DerivativesChina-Based IssuersRisk FactorsBusiness Description (Item 101)
2025-11-21 · · Comment 1 · page ii Explained / pushed back
Staff comment: We note from your disclosure that you exclude Hong Kong and Macau from your definition of “PRC” or “China” for the purpose of your annual report. In future filings, please revise to remove the exclusion of Hong Kong and Macau from such definition. Clarify that all the legal and operational risks associated with having operations in the People’s Republic of China (PRC) also apply to operations in Hong Kong and Macau. In this regard, ensure that your disclosure does not narrow risks related to operating in the PRC to mainland China only. Where appropriate, you may describe PRC law and then explain how law in Hong Kong and Macau differs from PRC law and describe any risks and consequences to…
letter → Company response: The Company respectfully advises the Staff that it does not have any operation in Hong Kong and Macau. In light of this, the Company believes that laws and regulations in Hong Kong and Macau, including the regulatory actions related to data security or anti-monopoly concerns and regulations that may result in oversight over data security, do not have a material impact on its ability to conduct business, accept foreign investment, or list on a United States or foreign stock exchange. To the extent that the Company has material operations in Hong Kong and/or Macau in the future, the Company will provide additional disclosures regarding the applicable laws and regulations in Hong Kong and/or…
response letter → 2025-11-21 · · Comment 2 · Holding Foreign Companies Accountable Act, page 4 Responded
Staff comment: In future filings, please disclose the location of your auditor’s headquarters. Similarly revise the related risk factor regarding the HFCAA on page 38.
letter → Company response: In response to the Staff’s comment, the Company respectfully undertakes to revise the relevant disclosure in its future Form 20-F filings as follows (with additions in underline showing the changes against the disclosure in the 2024 Form 20-F), subject to such updates and adjustments to be made in connection with any material developments of the subject matter being disclosed. 2 “ D. Risk Factors … Risks Related to Doing Business in China … The ADSs may be prohibited from being traded over the counter in the United States under the HFCAA if the SEC subsequently determines our audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely. The prohibition…
response letter → 2025-11-21 · · Comment 3 · a material adverse effect on our business..., page 35 Responded
Staff comment: We note you made changes to the disclosure on page 35 from what you previously disclosed in the Form F-1/A filed on February 3, 2021, regarding the legal and operational risks associated with operating in China and PRC regulations. It is unclear to us that there have been changes in the regulatory environment in the PRC since your initial registration statement that would warrant such revisions, which mitigate the challenges you face and related disclosures. In future filings, please restore your disclosure. For additional guidance, please refer to the Division of Corporation Finance’s Sample Letter to China-Based Companies, issued December 2021 and July 2023.
letter → Company response: In response to the Staff’s comment, the Company respectfully undertakes to revise the relevant disclosure in its future Form 20-F filings as follows (with deletions shown in strikethrough and additions in underline showing the changes against the disclosure in the 2024 Form 20-F), subject to such updates and adjustments to be made in connection with any material developments of the subject matter being disclosed. “ D. Risk Factors … Risks Related to Doing Business in China Changes in China’s economic, political or social conditions or government policies could have a material adverse effect on our business and operations. We generate substantially all of our revenues from our operations in…
response letter → 2025-11-21 · · Comment 4 · Revenue Recognition, page F-21 Responded
Staff comment: We note that you provide services as an agent in provision of CPaaS platforms to customers and recognize the related revenue on a net basis. We further note you disclose the “gross amount of revenue from services as an agent” for each period presented. Please tell us how you considered whether your discussion of revenue on a gross basis presents a non-GAAP measure and tell us how you considered the guidance in Item 10(e)(ii)(c) of Regulation S-K and the Question 100.04 of the Non-GAAP C&DIs.
letter → Company response: The Company respectfully clarifies that the previously disclosed “gross amount of revenue” was intended as an operational metric. In response to the Staff’s comment, the Company respectfully undertakes to revise the relevant disclosure in its future Form 20-F filings as follows (with deletions shown in strikethrough showing the changes against the disclosure in the 2024 Form 20-F), subject to such updates and adjustments to be made in connection with any material developments of the subject matter being disclosed. “ NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS … 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES … (s) Revenue recognition … 5 CPaaS revenues The Company accounts for revenue from…
response letter → Full letter on EDGAR → · Filing index · All Cloopen Group Holding Ltd (RAASY) correspondence
ASC 606: Principal vs. Agent – what to check: For each arrangement, document who controls the good or service before transfer (ASC 606-10-55-37A/39 indicators) and state the gross vs. net conclusion and rationale in the revenue policy.
ASC 606: Revenue Recognition – what to check: Confirm each performance obligation, timing (point vs. over time) and significant judgments are disaggregated and explained, not boilerplate ASC 606 language.
Non-GAAP: Adjustments & Labels – what to check: Do not exclude normal, recurring cash operating expenses or use individually tailored recognition methods; label measures clearly (C&DI 100.01–100.04).
Non-GAAP: Reconciliation & Usefulness – what to check: Reconcile every non-GAAP measure (including segment-level measures presented outside the ASC 280 note) to the most directly comparable GAAP measure, and explain why it is useful.
Debt, Equity & Derivatives – what to check: Walk through the ASC 480/815/470 analysis for convertibles, warrants and modifications, citing the specific guidance and conclusions.
China-Based Issuers – what to check: Address PRC regulatory, VIE structure, cash transfer and HFCAA disclosures prominently up front.
Risk Factors – what to check: Replace hypothetical risks with ones that have materialized and update for current events.
Business Description (Item 101) – what to check:
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