Company: FOXX
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001213900-25-014221
Chunk: 103

Company: Foxx Development Holdings Inc.
Filing Date: 2025-02-14
Form: 10-Q
Item: Item 8
Chunk 103
---
 are insufficient to bridge financial and liquidity shortfall, there
would likely be a material adverse effect on the Company and would materially adversely affect its ability to continue as a going concern.

As such, the Company’s
management has determined that the factors discussed above have raised substantial doubt about the Company’s ability to continue
as a going concern within one year after the date that the unaudited condensed consolidated financial statements are issued. The unaudited
condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern and, accordingly,
do not include any adjustments that might result from the outcome of this uncertainty.

Note 3 — Basis of presentation
and significant accounting policies

Basis of presentation

The accompanying unaudited
condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States
of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).
In the opinion of management, all adjustments, consisting only of normal recurring adjustments, considered necessary for a fair presentation
of its financial position and operation results. Interim results are not necessary indicative of results of a full year. The information
in this Quarterly Report on Form 10-Q (the “10-Q”) should be read in conjunction with information in the Annual Report for
the fiscal year ended June 30, 2024 on Form 10-K filed by the Company with the SEC on October 24, 2024.

Principles of consolidation

The unaudited condensed consolidated
financial statements include the financial statements of the Company and its subsidiaries. All transactions and balances among the Company
and its subsidiaries have been eliminated upon consolidation.

A subsidiary is an entity
in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial
and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at
the meeting of directors.

Use of estimates and assumptions

The preparation of unaudited
condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the unaudited
condensed consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results
could differ from these estimates.

6

Accounts receivable