Company: KPEA
Filing Date: 2025-02-14
Form Type: 10-Q
Source: 0001493152-25-006580
Chunk: 80

Company: Kun Peng International Ltd.
Filing Date: 2025-02-14
Form: 10-Q
Item: Item 1
Chunk 80
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 dividends is primarily dependent on us receiving distributions of funds from our VIE. Relevant PRC statutory laws and
regulations permit payments of dividends by our VIE and its subsidiaries only out of their retained earnings, if any, as determined in
accordance with PRC accounting standards and regulations and after they have met the PRC requirements for appropriation to statutory
reserves. Share capital of our PRC subsidiaries and VIE included in the Company’s consolidated net assets are also non-distributable
for dividend purposes. The results of operations reflected in the accompanying consolidated financial statements prepared in accordance
with U.S. GAAP differ from those reflected in the statutory financial statements of KP Tian Yu, the foreign-invested enterprise, King
Eagle (China), King Eagle (Tianjin), the VIE, and its subsidiaries. The Company is required to set aside at least 10% of its after-tax
profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of its registered capital. In addition,
the Company may allocate a portion of its after-tax profits based on PRC accounting standards to an enterprise expansion fund and a staff
bonus and welfare fund at its discretion. The statutory reserve funds and the discretionary funds are not distributable as cash dividends.

As
a result of the foregoing restrictions, King Eagle (China), King Eagle (Tianjin), and KP Tian Yu are restricted in their ability to transfer
their net assets to the Company. Foreign exchange and other regulations in the PRC may further restrict these entities from transferring
funds to the Company in the form of dividends, loans, and advances. As of December 31, 2024, King Eagle (China), King Eagle (Tianjin),
and KP Tian Yu incurred negative assets in the amount of $1,313,763 , $2,417,624 and $932, respectively. As
of September 30, 2024, King Eagle (China), King Eagle (Tianjin) and KP Tian Yu incurred negative assets in the amount of $1,327,000,
$2,539,081 and $962, respectively. Accordingly, the Company did not accrue statutory reserve funds as of December 31, 2024 and September
30, 2024.

    33

NOTE
12- REVENUE

Revenue:

The
following tables present disaggregated revenues for the three months ended December 31, 2024 and 2023: