Company: SCAG
Filing Date: 2025-07-03
Form Type: 20-F
Source: 0001213900-25-061408
Chunk: 37

Company: Scage Future
Filing Date: 2025-07-03
Form: 20-F
Item: Item 1
Chunk 37
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 30, 2024 and for the fiscal year then ended, and the review of unaudited condensed consolidated financial statements as
of December 31, 2024 and for the six months then ended, our management and our independent registered public accounting firm identified
deficiencies that represented material weaknesses in our internal control over financial reporting. As defined in the standards established
by the Public Company Accounting Oversight Board of the United States, a “material weakness” is a deficiency, or a combination
of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement
of the company’s annual or interim financial statements will not be prevented or detected on a timely basis. The material weaknesses
identified relate to: (1) insufficient financial reporting and accounting personnel with appropriate knowledge, skills, and experience
in the application of U. S. GAAP and SEC rules to prepare consolidated financial statements and related disclosures completely and
accurately; and (2) lack of sufficient controls designed and implemented in IT environment and IT general control activities, which
mainly associated with areas of financial system segregation of logical access security, IT service organization and cyber security for
the financial systems.

To remedy our identified
material weaknesses subsequent to December 31, 2024, we have started adopting measures to improve our internal control over financial
reporting, including, among others: (1) hiring more qualified accounting personnel with relevant U. S. GAAP and SEC reporting
experience and qualifications to strengthen the financial reporting function and to set up a financial and system control framework; (2) implementing
regular and continuous U. S. GAAP accounting and financial reporting training programs for our accounting and financial reporting
personnel; and (3) setting up the system control framework to address information technology general controls (“ ITGC”)
deficiencies.

However, we cannot assure
you that we will remediate our material weaknesses in a timely manner. See “ Risk Factors - Risks Relating to the PubCo - If
PubCo fails to maintain an effective system of internal control over financial reporting, it may be unable to accurately report its financial
results or prevent fraud, and investor confidence in PubCo and the market price of its securities may be adversely affected” in
the Form F-4, which is incorporated herein by reference.

Following the completion of the Business Combination, we have become
a public company in the U. S. and subject to the Sarbanes-Oxley Act of 2002. Section