Company: KPEA
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001641172-25-023821
Chunk: 17

Company: Kun Peng International Ltd.
Filing Date: 2025-08-14
Form: 10-Q
Item: Item 1
Chunk 17
---
 financial statements. Quarterly results are not necessarily indicative of results
for a full year. In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position
and the results of operations and cash flows for the quarterly periods have been included.

These
condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements
and notes thereto for the year ended September 30, 2024 included in the Form 10-K filed with the SEC on January 14, 2025.

The
condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United
States of America. This basis of accounting involves the application of accrual accounting and, consequently, revenues and gains are
recognized when earned and expenses and losses are recognized when incurred. The condensed consolidated financial statements are expressed
in U.S. dollars.

Principles
of Consolidation

The
condensed consolidated financial statements include the financial statements of the Company, its subsidiaries and its variable interest
entity (“VIE”). All significant intercompany transactions and balances within the Company have been eliminated upon consolidation.

Use
of Estimates and Assumptions

The
preparation of condensed consolidated financial statements in conformity with generally accepted accounting principles requires management
to make estimates and assumptions that impact the presented amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the presented amounts of revenues and expenses during the period. Actual results
may differ from those estimates. Significant estimates during the quarters ended June 30, 2025 and 2024 include the collectability of
receivables, the useful lives of long-lived assets and intangibles, assumptions used in assessing impairment of long-lived assets, valuation
of accruals for expenses, and tax due.

    12

Going
Concern

The
accompanying condensed consolidated financial statements 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 and business developments.
In assessing the Company’s liquidity, the Company monitors and analyzes its cash and cash equivalents and its operating and capital
expenditure commitments. The Company’s liquidity needs are to meet its working capital requirements, operating