Company: SATT
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001683168-25-002119
Chunk: 305

Company: SATIVUS TECH CORP.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 3
Chunk 305
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 uncertainty. This matter is also described
in the “Critical Audit Matters” section of our report.

Critical Audit Matters

The critical audit matters communicated below
are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to
the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our
especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion
on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions
on the critical audit matters or on the accounts or disclosures to which they relate.

 F-2 

Going concern- refer to note 1 of the financial
statements

Critical audit matter description

The Company raised substantial doubt about
the entity’s ability to continue as a going concern for a reasonable period of time. The financial statements for the years
under audit have been prepared to assume that the Company will continue as a going concern, which contemplates the realization of
assets and satisfaction of liabilities in the normal course of business. We have identified the Going Concern as a critical audit
matter because of the significant estimates and assumptions made by management. This required a high degree of auditor judgment and
an increased extent of effort when performing audit procedures to evaluate the reasonableness of the Company’s assessment of
Going Concern. See the explanatory paragraph of the opinion paragraph.

How the Critical Audit Matter was addressed in
our Audit

The primary procedures we performed to address
this critical audit matter included the following: (i) We evaluate whether there is substantial doubt about the entity’s ability
to continue as a going concern for a reasonable period of time. (ii) We obtained information about management’s plans that are intended
to mitigate the effect of such conditions or events and assess the likelihood that such plans can be effectively implemented. (iii) We
added an explanatory paragraph to the audit report.

Evaluation of convertible debt with an embedded
derivative liability and detachable warrants

Critical audit matter description

As discussed in Notes 2 and 3 to the financial
statements, upon initial recognition of Convertible loans, Convertible Notes, similar instruments issued with or without detachable warrants,
the Company considers whether the embedded feature within the convertible instruments should be separated from the host instrument and
the manner of its presentation and future measurement and weather warrants granted by the Company to lenders through convertible bridge