ATIF Holdings Ltd

Previous wording

We offer financial consulting services to small and medium-sized enterprise customers in Asia and North America. Our goal is to become an international financial consulting company with clients and offices throughout Asia. Since our inception in 2015, the focus of our consulting business has been providing comprehensive going-public consulting services designed to help small and medium-sized enterprises (“SME”)become public companies on suitable markets and exchanges.

Current wording

We offer financial consulting services to small and medium-sized enterprise customers in Asia and North America. Our goal is to become an international financial consulting company with clients and offices throughout Asia. Since our inception in 2015, the focus of our consulting business has been providing comprehensive going public consulting services designed to help SMEs become public companies on suitable markets and exchanges.

Previous wording

Currently we provide consulting services to the companies based in North America and Asia seeking listing in U.S.. We launched our consulting services in 2015. Our aim was to assist Chinese enterprises by filling the gaps and forming a bridge between PRC companies and overseas stock markets and exchanges. We have a team of qualified and experienced personnel with legal, regulatory, and language expertise in several jurisdictions outside the U.S. Our services were designed to help SMEs in China achieve their goal of becoming public companies. In May 2022, we shifted our geographic focus from China to North America emphasizing on helping mid and small companies in North America become public companies on the U.S. capital markets. We would create a going public strategy for each client based on many factors of such client, including our assessment of the client’s financial and operational situations, market conditions, and the client’s business and financing requirements. Since our inception and up to the date of this report, we have successfully helped three Chinese enterprises to be quoted on the U.S. OTC markets and are currently assisting our other clients in their respective going public efforts. Most of our current and past clients have been Chinese, U.S. and Mexican companies, and we plan to expand our operations to other Asian countries, such as Malaysia, Vietnam, and Singapore with continuing focus on the North American market in the coming years.

Current wording

We launched our consulting services in 2015. Our aim was to assist Chinese enterprises by filling the gaps and forming a bridge between PRC companies and overseas stock markets and exchanges. We have a team of qualified and experienced personnel with legal, regulatory, and language expertise in several jurisdictions outside the U.S. Our services were designed to help small and medium-sized enterprises (“SME”) in China achieve their goal of becoming public companies. In May 2022, we shifted our geographic focus from China to North America emphasizing on helping mid and small companies in North America become public companies on the U.S. capital markets. We would create a going public strategy for each client based on many factors of such client, including our assessment of the client’s financial and operational situations, market conditions, and the client’s business and financing requirements. Since our inception and up to the date of this report, we have successfully helped nine Chinese enterprises to be quoted on the U.S. OTC markets and are currently assisting our other clients in their respective going public efforts. Most of our current and past clients have been Chinese, U.S. and Mexican companies, and we plan to expand our operations to other Asian countries, such as Malaysia, Vietnam, and Singapore with continuing focus on the North American market in the coming years.

Previous wording

For the nine months ended April 30, 2024 and 2023, we provided consulting services to four and two customers, respectively, which primarily engaged the Company to provide consulting services relating to going public in the US through IPO, reverse merger and acquisition. We plan to focus on providing consulting services to customers based in North America and other areas and intend to continue cooperating with Huaya, which was one of our subsidiaries before May 2022, in connection with the expansion and provision of our business services in China.

Current wording

For the three months ended October 31, 2024 and 2023, we provided consulting services to none and three customers, respectively, which primarily engaged the Company to provide consulting services relating to going public in the US through IPO, reverse merger and acquisition. From April 2022 through the date of this report, the Company entered into consulting agreements with nine customers, among which three are based in the North America.

Previous wording

Our total revenue generated from consulting services was approximately $0.2 million and $0.1 million for the three months ended April 30, 2024 and 2023, respectively. Our total revenue generated from consulting services was approximately $0.4 million and $2.3 million for the nine months ended April 30, 2024 and 2023, respectively.

Current wording

Our total revenue generated from consulting services amounted to $nil and approximately $0.1 million for the three months ended October 31, 2024 and 2023, respectively.

Previous wording

Our customer acquisition channels primarily include our sales and marketing campaigns and existing customer referrals. In order to acquire customers, we have made significant efforts in building mutually beneficial long-term relationships with, academic institutions, and local business associations. If any of our current customer acquisition channels becomes less effective, we are unable to continue to use any of these channels or we are not successful in using new channels, we may not be able to attract new customers in a cost-effective manner or convert potential customers into active customers or even lose our existing customers to our competitors. To the extent that our current customer acquisition and retention efforts become less effective, our service revenue may be significantly impacted, which would have a significant adverse effect on our revenues, financial condition, and results of operations.

Current wording

Our customer acquisition channels primarily include our sales and marketing campaigns and existing customer referrals. In order to acquire customers, we have made significant efforts in building mutually beneficial long-term relationships with local government, academic institutions, and local business associations. In addition, we also market our consulting services through social media, such as WeChat and Weibo. If any of our current customer acquisition channels becomes less effective, we are unable to continue to use any of these channels or we are not successful in using new channels, we may not be able to attract new customers in a cost-effective manner or convert potential customers into active customers or even lose our existing customers to our competitors. To the extent that our current customer acquisition and retention efforts become less effective, our service revenue may be significantly impacted, which would have a significant adverse effect on our revenues, financial condition, and results of operations.

Previous wording

We rely heavily on the expertise and leadership of our directors and officers to maintain our core competence. As our business scope increases, we expect to continue to invest significant resources in hiring and retaining a deep talent pool of financial consultancy professionals. Our ability to sustain our growth will depend on our ability to attract qualified personnel and retain our current staff.

Current wording

We rely heavily on the expertise and leadership of our directors and officers to maintain our core competence. Under their leadership, we have been able to achieve rapid expansion and significant growth since our inception in 2015. As our business scope increases, we expect to continue to invest significant resources in hiring and retaining a deep talent pool of financial consultancy professionals. Our ability to sustain our growth will depend on our ability to attract qualified personnel and retain our current staff.

Previous wording

***Revenues.***Our total revenue increased by approximately $0.1 million from approximately $0.1 million for the three months ended April 30, 2023, to approximately $0.2 million in three months ended April 30, 2024.

Current wording

***Revenues.***Our total revenue decreased by approximately $0.1 million, or 100%, from approximately $0.1 million for the three months ended October 31, 2023, to $nil in for the three months ended October 31, 2024.

Previous wording

***Revenues.***Our total revenue decreased by approximately $1.9 million from approximately $2.3 million for the nine months ended April 30, 2023, to approximately $0.4 million in nine months ended April 30, 2024.

Current wording

General and administrative expenses. Our general and administrative expenses decreased by approximately $0.3 million, or 37%, from approximately $0.7 million for the three months ended October 31, 2023, to approximately $0.4 million for the three months ended October 31, 2024.

Previous wording

General and administrative expenses. Our general and administrative expenses primarily consisted of salary and welfare expenses of management and administrative team, office expenses, operating lease expenses, and professional fees such as audit and legal fees. Our general and administrative expenses increased from approximately $1.7 million in the nine months ended April 30, 2023 to approximately $1.8 million in the same period of 2024, which was primarily due to an increase of legal expenses of approximately $0.2 million for legal proceedings with both Boustead Securities, LLC and J.P Morgan Securities LLC.

Current wording

Our general and administrative expenses primarily consisted of salary and welfare expenses of management and administrative team, professional expenses, office expenses, operating lease expenses. The decrease in general and administrative expenses was primarily due to a decrease of approximately $0.2 million in payroll expenses because we adjusted monthly payroll expenses to Mr. Jun Liu from $20,000 to $1 since February 2024, and a decrease of approximately $0.1 million in office expenses.

Previous wording

(Loss) gain from investment in trading securities. (Loss) gain from investments in trading securities represented unrealized gains or losses from investment in trading securities, which was measured at market price. For the nine months ended April 30, 2024 and 2023, the Company recorded a loss from investment in trading securities of approximately $0.3 million and a gain from investment int trading securities of approximately $0.1 million, respectively.

Current wording

***Gain (loss) from investment in trading securities.***Loss from investment in trading securities represented fair value changes from investment in trading securities, which was measured at market price. For the three months ended October 31, 2024 and 2023, we recorded an investment gain of approximately $0.1 million and an investment loss of approximately $0.1 million, respectively.

Previous wording

Net (loss) income. As a result of foregoing, net loss was approximately $1.8 million for the nine months ended April 30, 2024, a change of $2.2 million from net income of approximately $0.4 million for the nine months ended April 30, 2023.

Current wording

Net income (loss). As a result of foregoing, net loss was approximately $0.4 million for the three months ended October 31, 2024, a decrease of approximately $0.2 million from net loss of $0.6 million for the three months ended October 31, 2023.

Previous wording

To date, we have financed our operations primarily through cash flows from operations, working capital loans from our major shareholders, proceeds from our initial public offering, and equity financing through public offerings of our securities. We plan to support our future operations primarily from cash generated from our operations and cash on hand.

Current wording

To date, we have financed our operations primarily through cash flows from operations, working capital loans from our major shareholders, proceeds from our initial public offering, and equity financing through public offerings of our securities. We plan to support our future operations primarily from cash generated from our operations and cash on hand. However, the Company may need to raise the cash flow from related parties, and there is no assurance that the Company will be able to obtain funds on commercially acceptable terms, if at all.

Previous wording

In assessing the Company’s ability to continue as a going concern, the Company monitors and analyzes its cash and its ability to generate sufficient cash flow in the future to support its operating and capital expenditure commitments.

Current wording

For the three months ended October 31, 2024 and 2023, the Company reported a net loss of approximately $0.4 million and $0.6 million, respectively, and operating cash outflows approximately $0.8 million and operating cash inflows of approximately $0.2 million. In assessing the Company’s ability to continue as a going concern, the Company monitors and analyzes its cash and its ability to generate sufficient cash flow in the future to support its operating and capital expenditure commitments. Because of a history of net losses from operations, cash out from operating activities, and the requirement of additional capital to fund our current operating plan at October 31, 2024, these factors indicate the existence of an uncertainty that raises substantial doubt about the Company’s ability to continue as a going concern.

Previous wording

As of April 30, 2024, the Company had cash of approximately $2.1 million, accounts receivable of approximately of $0.2 million and short-term investments of approximately $0.2 million, which were highly liquid. On the other hand, the Company had current liabilities of approximately $0.2 million The Company’s current assets could well cover its current liabilities. For the nine months ended April 30, 2024, the Company raised net proceeds of approximately $2.3 million from issuance of ordinary shares in a private placement. In addition, one of the related parties waived liabilities payable of approximately $0.7 million due to the related party. The Company’s ability to continue as a going concern is dependent on management’s ability to successfully execute its business plan, which includes increasing revenue while controlling operating cost and expenses to generate positive operating cash flows and obtain financing from outside sources.

Current wording

As of October 31, 2024, the Company had cash of approximately $0.5 million, short-term investments in trading securities of approximately $4.2 million, due from a related party of $0.9 million and accounts receivables of $0.2 million due from a related party, which were highly liquid. On the other hand, the Company had current liabilities of approximately $0.6 million. The Company’s cash and short-term investments in trading securities could well cover the current liabilities. The Company’s ability to continue as a going concern is dependent on management’s ability to successfully execute its business plan, which includes increasing revenue while controlling operating cost and expenses to generate positive operating cash flows and obtain financing from outside sources.

Previous wording

The condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above.

Current wording

The unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above.

Previous wording

Net cash used in operating activities was $84,188 in the nine months ended April 30, 2024. Net cash used in operating activities was primarily comprised of net loss of approximately $1.8 million, adjusted for loss from investment of trading securities of approximately $0.3 million, and net changes in our operating assets and liabilities, principally comprising of (i) a decrease of accounts receivable of approximately $0.5 million and $0.6 million, respectively, due from third party customers and related party customers as a result of collection of consulting fees from customers, (ii) a decrease of prepaid expenses and other current assets of approximately $0.2 million due to amortization of prepaid advertising service fees, and (iii) an increase of accrued expenses and other current liabilities of approximately of $0.2 million as a result of accrual of payroll expenses and legal service fees.

Current wording

Net cash provided by operating activities was $0.2 million in the three months ended October 31, 2023. Net cash used in operating activities was primarily comprised of net loss of $0.6 million, adjusted for a loss of $0.1 million from investment in trading securities, and net changes in our operating assets and liabilities, principally comprising of (i) a increase of accounts receivable of $0.6 million due from a related party because we collected outstanding balance from the related party; (ii) a decrease of $57,030 in prepaid expenses and other current assets because we amortized prepaid promotion expenses in the amount of $72,000; (iii) a decrease of $70,000 in deferred revenues because the customers terminated agreements with the Company and the Company would not refund the advances from customers; and (iv) a decrease of $83,842 in accrued expenses and other current liabilities.

Previous wording

Net cash used in investing activities was approximately $0.7 million in the nine months ended April 30, 2024, primarily used in investment in trading securities of approximately $0.4 million and loans made to related parties of approximately $0.3 million.

Current wording

Net cash used in investing activities was $0.4 million in the three months ended October 31, 2023, primarily consisting of payments of $0.4 million as investments in trading securities.

Previous wording

We prepare our condensed consolidated financial statements in accordance with U.S. GAAP, which requires our management to make estimates that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. As a result, management is required to routinely make judgments and estimates about the effects of matters that are inherently uncertain. Actual results may differ from these estimates under different conditions or assumptions.

Current wording

We prepare our audited consolidated financial statements in accordance with U.S. GAAP, which requires our management to make estimates that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. As a result, management is required to routinely make judgments and estimates about the effects of matters that are inherently uncertain. Actual results may differ from these estimates under different conditions or assumptions.