April 13, 2020
Anthony Poon
Chief Executive Officer
ALE Group Holding Ltd
Unit 1005, 10/F, Tower A, New Mandarin Plaza,
14 Science Museum Road,
Tsim Sha Tsui, Hong Kong
Re: ALE Group Holding Ltd
Draft Registration Statement on Form F-1
Submitted March 17, 2020
CIK 0001806905
Dear Mr. Poon:
We have reviewed your draft registration statement and have the
following comments. In
some of our comments, we may ask you to provide us with information so we may
better
understand your disclosure.
Please respond to this letter by providing the requested information and
either submitting
an amended draft registration statement or publicly filing your registration
statement on
EDGAR. If you do not believe our comments apply to your facts and circumstances
or do not
believe an amendment is appropriate, please tell us why in your response.
After reviewing the information you provide in response to these comments
and your
amended draft registration statement or filed registration statement, we may
have additional
comments.
Draft Registration Statement on Form F-1 Submitted March 17, 2020
Prospectus Summary, page 1
1. Please tell us what consideration you gave to summarizing the material
terms of the
memorandum of understanding with Forbes China in your prospectus and
filing it as an
exhibit.
2. We note that you believe one of your competitive advantages is that you
have long term
cooperation relationships with third party professional providers.
Please describe the
nature of these cooperation relationships, and the basis for your belief
that this reflects
both on your credibility and commitment towards providing quality
services to your
clients.
Anthony Poon
FirstName LastNameAnthony Poon
ALE Group Holding Ltd
Comapany NameALE Group Holding Ltd
April 13, 2020
Page 13,
April 2 2020 Page 2
FirstName LastName
Risk Factors, page 8
3. Please provide risk factor disclosure about your principal
shareholders' significant control
over the company, and state whether they will continue to control the
company after this
offering. Discuss the types of corporate matters that your principal
shareholders will have
the ability to control and clarify that minority shareholders will
have little ability to
influence the direction of the company as a result of this voting
control.
Managements Discussion and Analysis of Financial Condition and Results of
Operations
Results of Operations, page 38
4. We note that revenue decreased 19% due to fee adjustments for
accounting and financial
reporting services and discontinued services, offset by an increase in
taxation and
secretarial services during the year ended March 31, 2019. Please
quantify all factors
contributing to changes in revenue pursuant to Part I, Item 5.B of
Form 20-F and Section
III.D of SEC Release No. 33-6835.
5. We note per page 9 that you have experienced fluctuations in revenue
and cost structure
from the types, complexity, number, size, timing and duration of
client engagements; the
utilization of revenue-generating professionals; and billing rates and
fee arrangements,
including the ability to successfully reach milestones, and expect
that these fluctuations
will continue to occur in the future. Please provide a discussion of
the extent to which
changes in revenue are attributable to changes in these items. Refer
to Part I, Item 5.B of
Form 20-F.
Plan of Distribution, page 91
6. We note that investors in the offering will be required to complete a
subscription
agreement. Please file the form of subscription agreement as an
exhibit. Please refer to
Item 601(b)(10) of Regulation S-K.
Consolidated Statement of Operations, page F-4
7. We note that you present salaries and employee benefits as general and
administrative
expenses in your consolidated statement of operations. It appears that
these costs are
directly attributable to revenue and therefore are required to be
included in costs and
expenses applicable to revenues (cost of services) pursuant to Rule
5-03.2(a) of
Regulation S-X. Please advise.
Statement of Consolidated Cash Flows , page F-6
8. We note that you have classified "Loan to a director" and "Repayments
of loans from a
Director" as cash flows from financing activities. These cash flows
should be classified as
cash flows from investing activities. Please see ASC 230-10-45-12a and
13a for further
guidance and revise accordingly.
Anthony Poon
ALE Group Holding Ltd
April 13, 2020
Page 3
Note 6: Accrued expenses and other payables, page F-18
9. We note per page 61 that you request prepayment from the majority of
clients that you
provide secretarial services and recognize these amounts as deferred
revenue; however,
there is no deferred revenue recorded on the balance sheet for the
periods presented.
Please advise.
Index to Consolidated Financial Statements
Note 8. Related party transactions and balances, page F-21
10. We note a loan receivable from your CFO, Mr. Raymond Wai Man Yip, in
the amount of
$2,452,841 HKD as of September 30, 2019 that was wholly settled by
March 2020.
Please disclose the manner of settlement pursuant to ASC
850-10-50-1(d).
Revenue Recognition, page F-29
11. We note in your revenue recognition policy under ASC 606 on page F-30
that you have
no variable consideration. We also note per your discussion in MD&A
that revenue
decreased primarily for fee adjustments. Please tell us the nature of
these adjustments
and your consideration of ASC 606-10-32-7 in determining transaction
price.
You may contact Aamira Chaudhry at 202-551-3389 or Theresa Brillant at
202-551-3307
if you have questions regarding comments on the financial statements and
related
matters. Please contact Jacqueline Kaufman at 202-551-3797 or Lilyanna Peyser
at 202-551-
3222 with any other questions.
FirstName LastNameAnthony Poon Sincerely,
Comapany NameALE Group Holding Ltd
Division of
Corporation Finance
April 13, 2020 Page 3 Office of Trade &
Services
FirstName LastName