Company: KPEA
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010699
Chunk: 93

Company: Kun Peng International Ltd.
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 2
Chunk 93
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963  
     236 
  
    Advertising 
     3,893  
     4,529 
  
    Total 
    $512,908  
    $320,226 

Other income (expense)

Other income
(expense) primarily consisted of bank interest income and expense, share of profit from investment in associate, loss from
investment, and foreign exchange gain or loss. Our other income for the three months ended March 31, 2025 was $121,965 and other
expenses for the three months ended March 31, 2024 was $440. We recognized a $147,579 gain on the disposal of a subsidiary and a
$21,444 loss from share of profit from investment in associate for the three months ended March 31, 2025.

Income tax expense

For the three months ended March
31, 2025 and 2024, our income tax expense was nil and $13,364, respectively. Due to the net loss before income tax, the Company recognized
a full valuation recognition against its deferred tax assets, which mainly included net operating loss carryforwards, as management believes
it is more likely than not that the Company will not realize its net operating loss carryforwards in the near future or before they expire.

	During the three months ended
March 31, 2024, Kun Zhi Jian (Huai’an) realized income of $50,293 and we recognized an income tax expense in accordance with the
PRC’s statutory income tax rate 25%.

 41 

Net loss

As a result of the factors discussed
above, we posted a net loss in the amount of $192,877 for the three months ended March 31, 2025 compared to a net loss in the amount of
$597,435 for the three months ended March 31, 2024.

Foreign currency translation
adjustment

The functional currency for our
operations in the PRC is the Chinese Yuan or Renminbi (“RMB”); the functional currency for our operations in Hong Kong is
the Hong Kong Dollar (“HKD”). The financial statements are translated to U.S. dollars using the period end rates of exchange
for assets and liabilities; equity is translated at historical exchange rates; and average rates of exchange (for the period) are used
for revenues and expenses and cash flows. Transaction gains and/or losses that arise from exchange rate fluctuations on transactions denominated
in a currency other than the functional