Company: KMRK
Filing Date: 2025-08-15
Form Type: 20-F
Source: 0001213900-25-077494
Chunk: 41

Company: K-TECH SOLUTIONS CO LTD
Filing Date: 2025-08-15
Form: 20-F
Item: Item 3
Chunk 41
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OB
inspection in mainland China and Hong Kong prevents the PCAOB from fully evaluating audits and quality control procedures of the
auditors based in the mainland China and Hong Kong. As a result, the investors may be deprived of the benefits of such PCAOB inspections.
The inability of the PCAOB to conduct inspections of auditors in the mainland China and Hong Kong makes it more difficult to evaluate
the effectiveness of these accounting firms’ audit procedures or quality control procedures as compared to auditors outside of the
mainland China and Hong Kong that are subject to the PCAOB inspections, which could cause existing and potential investors in our
Class A Shares to lose confidence in our audit procedures and reported financial information and the quality of our financial statements.

On December 29, 2022,
the AHFCA Act was enacted, which amended the HFCA Act by requiring the SEC to prohibit an issuer’s securities from trading on any
U. S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three, and thus,
reduced the time before our Class A Shares may be prohibited from trading or delisted.

The SEC is assessing how to
implement other requirements of the HFCA Act, including the listing and trading prohibition requirements described above. Future developments
in respect of increasing U. S. regulatory access to audit information are uncertain, as the legislative developments are subject to
the legislative process and the regulatory developments are subject to the rule-making process and other administrative procedures.

While we understand there has
been dialogue among the CSRC, the SEC, and the PCAOB regarding the inspection of PCAOB registered accounting firms in mainland China and
Hong Kong, there can be no assurance that we will be able to comply with requirements imposed by U. S. regulators if there is
significant change to current political arrangements between mainland China and Hong Kong or if any component of our auditor’s
work papers become located in mainland China in the future. Delisting of our Class A Shares would force holders of our Class A Shares
to sell their Class A Shares. The market price of our Class A Shares could be adversely affected as a result of anticipated negative impacts
of these executive or legislative actions, regardless of whether these executive or legislative actions are implemented and regardless
of our actual operating performance.

Recent joint statement by the SEC and PCAOB,
and the HFCA Act all call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification
of their auditors, especially the non-U. S