Company: GCL
Filing Date: 2025-08-27
Form Type: DRS
Source: 0001213900-25-080905
Chunk: 49

Company: GCL Global Holdings Ltd
Filing Date: 2025-08-27
Form: DRS
Chunk 49
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 subject it to adverse regulatory consequences and could harm investor confidence and the market price of GCL ordinary
shares.

GCL’s independent
registered public accounting firm is not required to report on the effectiveness of its internal control over financial reporting pursuant
to Section 404(b) of the Sarbanes-Oxley Act of 2002 until GCL’s first Form 20-F following the date on which it ceases to qualify
as an “emerging growth company,” which may be up to five full fiscal years following the date of the first sale of common
equity securities pursuant to an effective registration statement. If such evaluation were performed, control deficiencies could be identified
by GCL’s management, and those control deficiencies could also represent one or more material weaknesses. In connection with the
preparation of the Company’s consolidated financial statements for fiscal years 2025, the Company identified material weaknesses
in its internal control over financial reporting, as defined in the standards established by the PCAOB. The material weakness identified
related to (i) lack of accounting staff and resources with appropriate knowledge of GAAP and SEC reporting and compliance requirements
to design and implement formal period-end financial reporting policies and procedures to address complex technical accounting issue in
accordance with GAAP and the SEC requirements., and (ii) lack of information technology general controls in the areas of IT policies
and procedures, user provisioning and termination, privileged access and service organization monitoring who are responsible for change
management over certain core business system and accounting system. To remediate the material weaknesses, the Company has begun, and
will continue, to (A) hire additional finance and accounting staff with qualifications and work experience in GAAP and SEC reporting
requirements to formalize the key internal control over financial reporting; (B) allocate sufficient resources to prepare and review
financial statements and related disclosures in accordance with GAAP and SEC reporting requirements; and (C) hire experienced IT staff
with qualifications of the CRISC (“Certified in Risk and Information Systems Control”) to formalize and strengthen the key
internal control over Information Technology General Control. In addition, GCL cannot predict the outcome of this determination and whether
GCL will need to implement remedial actions in order to implement effective control over financial reporting. If in subsequent years
GCL is unable to assert that GCL’s internal control over financial reporting is effective, or if GCL’s auditors express an
opinion that GCL’s internal control over financial reporting is ineffective, GCL may fail to