Company: FEBO
Filing Date: 2025-05-14
Form Type: 20-F
Source: 0001641172-25-010075
Chunk: 5

Company: Fenbo Holdings Ltd
Filing Date: 2025-05-14
Form: 20-F
Item: Item 3
Chunk 5
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 transactions.

Even if we develop effective internal
controls over financial reporting, such controls may become inadequate due to changes in conditions or the degree of compliance with such
policies or procedures may deteriorate, which could result in the discovery of additional material weaknesses and deficiencies. In any
event, the process of determining whether our existing internal control over financial reporting is compliant with Section 404 of the
Sarbanes-Oxley Act (“ Section 404”) and is sufficiently effective requires the investment of substantial time and resources
by our senior management. As a result, this process may divert internal resources and take a significant amount of time and effort to
complete. In addition, we cannot predict the outcome of this process and whether we will need to implement remedial actions in order to
establish effective controls over financial reporting. The determination of whether our internal controls are sufficient and any remedial
actions required could result in our incurring additional costs that we did not anticipate, including the hiring of additional outside
consultants. We may also fail to timely complete our evaluation, testing and any remediation required to comply with Section 404.

We are required, pursuant to Section
404, to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting. However,
for as long as we are an “emerging growth company” or for as long as we are not an accelerated filer under Rule 12b-2 under
the Securities Exchange Act of 1934, our independent registered public accounting firm will not be required to attest to the effectiveness
of our internal control over financial reporting pursuant to Section 404. While we could be exempt from the auditor attestation requirement
for an indefinite amount of time even after we lose our status as an emerging growth company, an independent assessment of the effectiveness
of our internal control over financial reporting, if obtained, could detect problems that our audit committee’s assessment might
not. Such undetected material weaknesses in our internal control over financial reporting could lead to financial statement restatements
and require us to incur the expense of remediation.

Risks Related to Doing Business in the People’s
Republic of China and Hong Kong

A downturn in the Hong Kong, China or global
economy, or a change in economic and political policies of China, could materially and adversely affect our Operating Subsidiaries’
business and financial condition.

Our Operating
Subsidiaries’ business, prospects, financial condition and results of operations may be influenced to a