Company: KNRX
Filing Date: 2025-06-12
Form Type: F-1/A
Source: 0001641172-25-014801
Chunk: 40

Company: KNOREX LTD.
Filing Date: 2025-06-12
Form: F-1/A
Chunk 40
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 such as SOC audits, and industry-wide, there is limited ability to verify such data independently. This reliance presents challenges in ensuring full transparency and control over certain service records, resulting in the inability to independently verify the accuracy of service records for revenue recognition; (ii) the lack of effective formal policies and procedures to establish risk assessment processes and ensure consistent control application in accordance with the COSO Framework; (iii) inadequate supervision and review over recordkeeping, leading to misstatements of some items in the income and balance sheet statements; and (iv) a lack of accounting personnel adequately trained in U.S. GAAP and SEC reporting.

We have taken initiatives to improve our internal control over financial reporting to address the underlying causes of these material weaknesses, including (i) hiring more qualified accounting staff and strengthening our supervision of recordkeeping; (ii) providing our relevant finance staff with appropriate training regarding requirements of U.S. GAAP and hiring additional personnel who are equipped with relevant U.S. GAAP and SEC reporting experience; (iii) set up an internal audit function as well as engaging an external consulting firm to assist us with assessing our Sarbanes-Oxley compliance readiness and improving overall internal controls; and
(vi) appointed our board members with the relevant experiences to govern and
oversee the audit and finance functions.

However, we cannot assure you that we will complete the implementation of these measures in a timely manner. In addition, our shares may not be able to remain listed on the NYSE American if we are unable to meet the requirements of Section 404 such as that we include a report of management on our internal control over financial reporting in our annual report on Form 20-F beginning with our annual report beginning with our second annual report on Form 20-F. In addition, once we cease to be an “emerging growth company” as such term is defined under the JOBS Act, our independent registered public accounting firm must attest to and report on the effectiveness of our internal control over financial reporting.

We will be subject to the requirement that we maintain internal controls and that management perform periodic evaluation of the effectiveness of the internal controls. Effective internal control over financial reporting is important to prevent fraud. As a result, our business, financial condition, results of operations and prospects, as well as the market for and trading price of our Class A Ordinary Shares, may be materially and adversely affected if we do not have effective internal controls. We may not discover any problems in a timely manner and current and potential shareholders could lose confidence in our financial reporting,