Company: KPEA
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001493152-25-006580
Chunk: 99

Company: Kun Peng International Ltd.
Filing Date: 2025-02-14
Form: 10-Q
Item: Item 1
Chunk 99
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 service agreements as of December 31, 2024 and September 30, 2024,
respectively.

In
an effort to support and maintain our financial position and operations, to fulfill our contractual commitments, and to meet the demands
from our customers for refund of their advance payments, the Company focused on increasing its revenue through its online platform. In
November 2023, we launched Kun Zhi Jian Mini Program and explored four additional revenue streams. Simultaneously, our directors and
stakeholders continue to support our operation financially. We believe that such measures will improve our liquidity in the next twelve
months. If we are not able to increase revenue or obtain any financing, we may be unable to continue as a going concern.

Going
Concern Consideration

The
financial statements included in this Quarterly Report have been prepared in conformity with accounting principles generally accepted
in the United States of America which contemplate continuation of the Company as a going concern. The going-concern basis assumes that
assets are realized and liabilities are extinguished in the ordinary course of business at amounts disclosed on the financial statements.
The Company’s ability to continue as a going concern depends on the liquidation of its current assets. For the three months ended
December 31, 2024, the Company experienced cash inflows from operating activities of $45,864, incurred a net loss of $651,007, and had
negative working capital of $8,198,139. These conditions raise substantial doubt about the ability of the Company to continue as a going
concern.

The
Company continues to monitor its operations to help refine its financial liquidity. Options under consideration in the review process
include, but are not limited to, increase of sales through the Company’s online business, reduction of overhead costs, fund advance
from the Company’s stockholders and directors, or financing through the issuance of shares. The Company has been focusing on increasing
its revenue through its online platform and trimming its overhead costs. For example, it reduced lease payments and decreased office
supplies expense. Additionally, the Company obtained capital funding of approximately $0.6 million from its shareholders to meet its
working capital requirements. In order to continue as a going concern for the next 12 months, the Company is focusing on promoting and
selling its own brand of preventive health care products to wholesalers through Kun Zhi Jian, an online platform launched in October
2022, streamlining its overhead costs, or obtaining financing or capital funding from its stockholders or directors.