Company: QSJC
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0001683168-25-001892
Chunk: 632

Company: TANCHENG GROUP CO., LTD.
Filing Date: 2025-03-26
Form: 10-K
Item: Item 9A
Chunk 632
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management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use
or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of its inherent
limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate.

Our management, including
our principal executive officer and principal financial officer, assessed the effectiveness of our internal control over financial reporting
at December 31, 2024. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of
the Treadway Commission (COSO) in Internal Control—Integrated Framework (2013). Based on that assessment under those criteria, management
has determined that, as of December 31, 2024, our internal control over financial reporting was not effective.

The Company has identified
the following control deficiencies that constituted material weaknesses:

    ·
    The Company did not have an adequate internal control structure or adequate oversight over financial reporting. The Company had only a sole director and executive officer before October 12, 2023. Further, the Company currently has no Audit Committee. While not being legally obligated to have an audit committee, it is the management’s view that such a committee, including a financial expert member, is an utmost important entity level control over the Company’s financial statement. Currently the board of directors acts in the capacity of the Audit Committee, and does not include a member that is considered to be independent of management to provide the necessary oversight over management’s activities.

    ·
    The Company lacks appropriate information technology controls – As of December 31, 2024, the Company retains copies of all financial data and material agreements; however, there is no formal procedure or evidence of normal backup of the Company’s data or off-site storage of data in the event of theft, misplacement, or loss due to unmitigated factors.

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In order to mitigate
the foregoing material weakness, we have engaged an outside accounting consultant with significant experience in the preparation of financial
statements in conformity with GAAP to assist us in the preparation of our financial statements to ensure that these financial statements
are prepared in conformity with GAAP. We will continue to monitor the effectiveness of this action and make any changes that our