{"url_path":"/sec/pmnt/10-k/2026/item-7a","section_key":"item-7a","section_title":"Item 7A QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-06-29","source_url":"https://www.sec.gov/Archives/edgar/data/1849221/0001493152-26-030418-index.html","accession_number":"0001493152-26-030418","cik":"0001849221","ticker":"PMNT","issuer_name":"Perfect Moment Ltd.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1849221/0001493152-26-030418-index.html","primary_entity_key":"0001849221","primary_entity_name":"Perfect Moment Ltd."},"word_count":395,"has_tables":true,"body_markdown":"**ITEM\n7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**\n\n \n\nWe\nare exposed to market risks in the ordinary course of our business. These risks primarily include:\n\n \n\n**Interest\nrate risk**\n\n \n\nThe\nfair value of our cash equivalents, held primarily in cash deposits, have not been significantly impacted by increases or decreases in\ninterest rates to date, due to the short-term nature of these instruments. The interest expense associated with our revolver is a fixed\nrate. We are exposed to interest rate risk where the interest expense associated with our financing arrangements in the event that the\nfixed interest rate associated with our financing arrangements is increased upon roll-over of the financing arrangement at its contractual\nmaturity. Fluctuations in interest rates have not been significant to date. We do not expect that interest rates will have a material\nimpact on our results of operations.\n\n \n\n**Inflation\nrisk**\n\n \n\nWe\nare beginning to observe increases in our costs of goods sold, in particular, transportation costs. If these cost increases are sustained\nand we become subject to significant inflationary pressures, we may not be able to fully offset such higher costs. Our inability to do\nso could harm our business, results of operations or financial condition.\n\n \n\n**Foreign\nexchange risk**\n\n \n\nTo\ndate, revenue has primarily been generated in U.S. dollar, U.K. pound sterling and euro. As a result, our revenue may be subject to fluctuations\ndue to changes in foreign currency exchange rates, particularly changes in U.K. pound sterling and euros relative to the U.S. dollar.\nOur foreign exchange risk is less pronounced for our cost of sales as to our cost of goods sold being predominantly U.S. dollar denominated.\nOur selling, general and administrative expenses are primarily made up of U.S. dollar, Hong Kong dollar, U.K. pound sterling and euro\namounts. Although a portion of our non-U.S. dollar costs offset non-U.S. dollar revenue, a currency mismatch arises as to the amount\nand timing of our different currency cash flows. To date, we have not hedged our foreign currency exposure. We will continue to monitor\nthe impact of foreign exchange risk and review whether to implement a hedging strategy to minimize this risk in future accounting periods.\nHedging strategies where implemented, are unlikely to completely mitigate this risk. To the extent that foreign exchange risk is not\nhedged it may result in harm to our business, results of operations and financial condition."}