Company: FOXX
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-043597
Chunk: 12

Company: Foxx Development Holdings Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 1
Chunk 12
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 statements of the Company and its subsidiaries. All transactions and balances among the Company
and its subsidiaries have been eliminated upon consolidation.

A subsidiary is an entity
in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial
and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at
the meeting of directors.

Use of estimates and assumptions

The preparation of unaudited
condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the unaudited
condensed consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Actual results
could differ from these estimates.

Foreign currency translation and transactions

The reporting currency of the Company is the U.S. dollar. The functional
currency for our holding company is the U.S. dollar (“USD”). In Singapore, the Company conducts its business in the local
currency, Singapore dollar (“SGD”), as its functional currency. Assets and liabilities are translated at the unified exchange
rate as quoted by the Federal Reserve System at the end of the period. The statements of operations and cash flows are translated at the
average translation rates during the reporting periods and the equity accounts are translated at historical rates. Translation adjustments
resulting from this process are included in accumulated other comprehensive loss. Transaction gains and losses that arise from exchange
rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations
as incurred.

6

Translation adjustments are included in accumulated other comprehensive
loss. The balance sheet amounts, with the exception of shareholder’s equity (deficit) at March 31, 2025 were translated at SGD 1.34
to one USD, respectively. The average translation rates applied to the unaudited condensed consolidated statements of operations and cash
flows for three and nine months ended March 31, 2025 was SGD 1.33 to one USD. The shareholder’s equity accounts were translated
at their historical rates. Amounts reported on the unaudited condensed consolidated statement of cash flows will not necessarily agree
with changes in the corresponding balances on the unaudited condensed consolidated balance sheets. 

Segments

The Company uses the management
approach in determining reportable operating segments. The management approach considers the