Company: FSHPU
Filing Date: 2025-03-04
Form Type: 10-K
Source: 0001829126-25-001450
Chunk: 90

Company: Flag Ship Acquisition Corp
Filing Date: 2025-03-04
Form: 10-K
Item: Item 1
Chunk 90
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 immediately to consider the need to issue
a new determination. The auditor and its audit work in the PRC may not be inspected fully by the PCAOB. Inspections of other auditors
conducted by the PCAOB outside China have at times identified deficiencies in those auditors’ audit procedures and quality control
procedures, which may be addressed as part of the inspection process to improve future audit quality. The lack of PCAOB inspections of
audit work undertaken in China prevents the PCAOB from regularly evaluating the PRC auditor’s audits and its quality control procedures.
Our auditor, MaloneBailey LLP, is a United States accounting firm based in Houston and is subject to regular inspection by the PCAOB.
MaloneBailey LLP is not headquartered in mainland China or Hong Kong and was not identified in the Determination Report as a firm subject
to the PCAOB’s determinations. As a special purpose acquisition company, our current business activities only involve searching
for targets and consummation of a business combination. MaloneBailey LLP has access to our books and records which are currently maintained
by our bookkeeper residing in U.S. In addition, we will affirmatively exclude any target company with financial statements audited by
an accounting firm that the PCAOB is unable to inspect for two consecutive years beginning in 2021 at the time of our business combination.

Notwithstanding the foregoing,
in the event that we decide to consummate our initial business combination with a target business based in or primarily operating in China,
including the Proposed GRT Business Combination, if there is any regulatory change which prohibits the independent accountants from providing
audit documentations located in mainland China or Hong Kong to the PCAOB for inspection or investigation or the PCAOB expands the scope
of the Determination Report so that the target company or the combined company is subject to the HFCA Act, as the same may be amended,
you may be deprived of the benefits of such inspection which could result in limitation or restriction to our access to the U.S capital
markets and trading of our securities on a national securities exchange or in the over-the-counter trading market in the U.S. may be prohibited,
under the HFCA Act.

The SEC has adopted final rules to implement the HFCA Act and may propose additional rules or guidance that could impact us if our auditor is not subject to PCAOB inspection. These final rules require the SEC to identify registrants having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction that the