CHINA PHARMA HOLDINGS, INC. Leases Disclosure
NOTE 10 – LEASES
The Company has leases for certain office and production facilities in the PRC which are classified as operating leases. The leases contain payment terms for fixed amounts. Options to extend are recognized as part of the lease liabilities and recognized as right of use assets when management estimates to renew the lease. There are no residual value guarantees, no variable lease payments, and no restrictions or covenants imposed by leases. For the years ended December 31, 2025 and 2024, operating lease cost was $75,534 and $58,931, respectively and cash paid for amounts included in the measurement of lease liabilities for operating cash flows from operating leases was $78,705 and $61,135, respectively. As of December 31, 2025 and December 31, 2024, the Company reported right of use assets of $181,828 and $38,298, respectively and lease liabilities of $183,176 and $39,323, respectively.
| FY2025 | FY2024 | |||||||
| Operating lease cost | $ | 75,534 | 58,931 | |||||
| Cash paid for amounts included in the measurement of lease liabilities | 78,705 | 61,135 | ||||||
| December 31, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Lease liabilities, current portion | $ | 71,628 | 39,323 | |||||
| Lease liabilities, non current portion | 111,548 | |||||||
| 183,176 | 39,323 | |||||||
Minimum lease payments for the Company’s operating lease liabilities were as follows for the twelve month period ended December 31:
| 2026 | $ | 76,144 | ||
| 2027 | 76,144 | |||
| 2028 | 38,072 | |||
| Total undiscounted cash flows | 190,360 | |||
| Less: Imputed interest | (7,184 | ) | ||
| 183,176 | ||||
| Less: Lease liabilities, current portion | (71,628 | ) | ||
| Lease liabilities, non current portion | $ | 111,548 |
The Company has leases with terms less than one year for certain provincial sales offices that are not material.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Apr 1, 2026 | Showing above |
| 2024 | Mar 31, 2025 | |
| 2023 | Apr 1, 2024 | |
| 2022 | Mar 30, 2023 | |
| 2021 | Mar 30, 2022 | |
| 2020 | Mar 26, 2021 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.