Company: FEBO
Filing Date: 2025-05-14
Form Type: 20-F
Source: 0001641172-25-010075
Chunk: 4

Company: Fenbo Holdings Ltd
Filing Date: 2025-05-14
Form: 20-F
Item: Item 3
Chunk 4
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idiary’s operations may be negatively affected, which could adversely
affect our liquidity and our ability to fund and expand our business.

We have identified material weaknesses in
our internal control over financial reporting. If we fail to implement and maintain an effective system of internal control over
financial reporting, we may not be able to accurately report our financial results or prevent fraud. As a result, shareholders could
lose confidence in our financial and other public reporting, which could harm the trading price of our Ordinary
Shares.

Effective internal control over
financial reporting is necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures,
is designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in their implementation,
could cause us to fail to meet our reporting obligations. Ineffective internal control could also cause investors to lose confidence in
our reported financial information, which could have a negative effect on the trading price of our Ordinary Shares.

   6  

We
have identified material weaknesses in our internal control over financial reporting in the Company and in its subsidiaries. As defined
in Regulation 12b-2 under the Exchange Act, 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 our annual or interim consolidated
financial statements will not be prevented or detected on a timely basis. Specifically, we determined that we have the following material
weaknesses in our internal control over financial reporting: (i) we have limited controls over information processing; (ii) we have inadequate
segregation of duties; and (iii) we do not have sufficient formal written policies and procedures for accounting and financial reporting
with respect to the requirements and application of both generally accepted accounting principles in the United States of America, or
GAAP, and SEC guidelines. In addition, we donot have a qualified CFO, with US GAAP accounting knowledge and significant experience
working in U. S. listed companies on financial reporting, in place to oversee our financial reporting, and we currently rely on external
consultants regarding financial reporting functions.

Although
we currently have an audit committee comprised of three independent directors, one of whom management has determined qualifies as a financial
expertunder the applicable SEC rules, and our financial statements and footnotes are now
reviewed by our management and our audit committee, we do not have a formal policy to review significant accounting transactions and the
accounting treatment of such