Marwynn Holdings, Inc.

Previous wording

Marwynn Holdings, Inc. (“Marwynn” or the “Company”) was incorporated in the state of Nevada, United States of America (“USA”) on February 27, 2024. The Company is a holding company with no material operations of its own, Marwynn conducts substantially all its operations through its wholly-owned subsidiaries FuAn Enterprise, Inc (“FuAn”) and Grand Forest Cabinetry Inc (“Grand Forest”).

Current wording

Marwynn Holdings, Inc. (“Marwynn” or the “Company”) was incorporated in the state of Nevada, United States of America (“USA”) on February 27, 2024. The Company is a holding company with no material operations of its own, Marwynn conducts substantially all its operations through its wholly-owned subsidiaries.

Previous wording

FuAn was incorporated in the state of California on April 18, 2016. FuAn is a food and non-alcoholic beverage supply chain company that specializes in connecting businesses between different regions, particularly between Asia and the U.S. FuAn’s comprehensive supply chain services include the sourcing of Asian food, snacks, and non-alcoholic beverages, and distributing branded goods to mainstream markets, grocery stores and wholesale/warehouse clubs in the U.S. In addition, FuAn provides supply chain consulting, and market expansion support for businesses. With a focus on sourcing Asian foods and non-alcoholic beverages, FuAn aims at becoming a leading importer and distributor of premium Asian foods and non-alcoholic beverages to the U.S. markets.

Current wording

FuAn Enterprise, Inc (“FuAn”), a subsidiary of Marwynn, was incorporated in the state of California on April 18, 2016. FuAn is a food and non-alcoholic beverage supply chain company that specializes in connecting businesses between different regions, particularly between Asia and the U.S. FuAn’s comprehensive supply chain services include the sourcing of Asian food, snacks, and non-alcoholic beverages, and distributing branded goods to mainstream markets, grocery stores and wholesale/warehouse clubs in the U.S. In addition, FuAn provides supply chain consulting, and market expansion support for businesses. With a focus on sourcing Asian foods and non-alcoholic beverages, FuAn aims at becoming a leading importer and distributor of premium Asian foods and non-alcoholic beverages to the U.S. markets.

Previous wording

Grand Forest was incorporated in the state of California on February 22, 2021. Grand Forest is an indoor home improvement supply chain provider that focus on providing high-quality kitchen cabinets, flooring, and home improvement products sourced from international suppliers. Grand Forest focuses on sourcing high-quality products from reliable overseas suppliers and distributing them to customers across the U.S.

Current wording

Grand Forest Cabinetry Inc (“Grand Forest”), a subsidiary of Marwynn, was incorporated in the state of California on February 22, 2021. Grand Forest is an indoor home improvement supply chain provider that focus on providing high-quality kitchen cabinets, flooring, and home improvement products sourced from international suppliers. Grand Forest focuses on sourcing high-quality products from reliable overseas suppliers and distributing them to customers across the U.S.

Previous wording

During the first quarter of 2025, the United States has introduced trade policy actions that have increased import tariffs across a wide range of countries at various rates, including on product imports from almost all countries and individualized higher tariffs on certain other countries, such as China. Some of these tariff announcements have since been followed by announcements of limited exemptions and temporary pauses. Our business relies heavily on international supply chains and imported products, including food, non-alcoholic beverages, kitchen cabinets, flooring, and other home improvement goods. This dependence exposes us to risks associated with shifting global trade policies, tariffs, and geopolitical tensions, particularly in the Asia-Pacific region, and could negatively impact affect our business in multiple ways, including increased costs of our products. These tariffs have introduced additional volatility into our procurement and logistics operations and may increase our cost of goods sold, particularly for our food and cabinetry product lines, which are more reliant on imports from affected regions.

Current wording

During the first quarter of 2025, the United States has introduced trade policy actions that have increased import tariffs across a wide range of countries at various rates, including on product imports from almost all countries and individualized higher tariffs on certain other countries, such as China. Some of these tariff announcements have since been followed by announcements of limited exemptions and temporary pauses. Our current business relies heavily on international supply chains and imported products. This dependence exposes us to risks associated with shifting global trade policies, tariffs, and geopolitical tensions, particularly in the Asia-Pacific region, and could negatively impact affect our business in multiple ways, including increased costs of our products. These tariffs have introduced additional volatility into our procurement and logistics operations and may increase our cost of goods sold.

Previous wording

We derive our revenues from (i) sale of food and beverage, (ii) sale of indoor home improvement products, and (iii)** **consulting services. The following table presents our revenues by product and service types and as percentage of our total revenues for the periods presented.

Current wording

We derive our revenues from (i) sale of food and beverage, and (ii)** **consulting services. The following table presents our revenues by product and service types and as percentage of our total revenues for the periods presented.

Previous wording

Revenue from consulting services accounted for 1.76% and 1.70% of total revenues for the three months ended July 31, 2025 and 2024, respectively. Revenue from consulting services decreased by $6,989, or 14.49% from $48,239 for the three months ended July 31, 2024 to $41,250 for the three months ended July 31, 2025. We started our consulting services business in March 2024 through providing supply chain and brand management services proposals and solutions to customers to help them optimize their inventory management and product distribution strategy, to reduce delivery times, shipping costs and diversify distribution channels.

Current wording

Revenue from consulting services accounted for 100% and 100% of total revenues for the three months ended October 31, 2025 and 2024, respectively. Revenue from consulting services remained relatively consistent for the three months ended October 31, 2025 compared to the three months ended October 31, 2024. We started our consulting services business in March 2024 through providing supply chain and brand management services proposals and solutions to customers to help them optimize their inventory management and product distribution strategy, to reduce delivery times, shipping costs and diversify distribution channels.

Previous wording

As a result of the above, we had a net loss of $2,719,753 for the three months ended July 31, 2025, compared to a net loss of $328,531 for the three months ended July 31, 2024, an increase of net loss of $2,391,222 or 727.85%, which was mainly resulting from decreased revenue and increased audit, accounting and consulting fee, and insurance expense.

Current wording

As a result of the above, we had a net loss of $896,287 for the three months ended October 31, 2025, compared to a net loss of $114,371 for the three months ended October 31, 2024, an increase of net loss of $781,916 or 683.67%, which was mainly resulting from increased audit, accounting and consulting fee, and insurance expense.

Previous wording

Sales of food and beverage accounted for nil and 1.58% of total sales for the three months ended July 31, 2025 and 2024, respectively. Sales of food and beverage decreased by $44,886 or 100.00% from $44,886 for the three months ended July 31, 2024 to $nil for the three months ended July 31,2025. The decrease in our sales was primarily due to cease of the purchase orders from Costco, particularly in demand for White Rabbit ice creams. We are actively seeking new retailers and working with them to introduce new products that are less sensitive to the tariff tensions between the U.S. and China. We are also working with Costco on bringing more new products to their stores.

Current wording

Sales of food and beverage accounted for nil and 32.79% of total sales for the six months ended October 31, 2025 and 2024, respectively. Sales of food and beverage decreased by $44,886 or 100.00% from $44,886 for the six months ended October 31, 2024 to nil for the six months ended October 31,2025. The decrease in our sales was primarily due to cease of the purchase orders from Costco. We are actively seeking new retailers and working with them to introduce new products that are less sensitive to the tariff tensions between the U.S. and China.

Previous wording

We derive our costs from (i) sale of food and beverage, (ii) sale of indoor home improvement products, and (iii) consulting services. The following table presents our costs of revenues as percentage of its corresponding revenue for the periods presented.

Current wording

We incur our costs from (i) sale of food and beverage, and (ii) consulting services. The following table presents our costs of revenues as percentage of its corresponding revenue for the periods presented.

Previous wording

Cost of revenues from sale of food and beverage decreased by $23,773, or 100.00% from $23,773 for the three months ended July 31, 2024, to $nil for the three months ended July 31, 2025. Our cost of revenues from sale of food and beverage primarily includes inventory costs, storage and freight costs. The decrease in our cost of revenues for sale of food and beverage was mainly due to cease of purchase orders from Costco, we did not have any orders from Costco for the three months ended July 31, 2025 and 2024.We also had reduced storage fees and freight costs.

Current wording

Cost of revenues from sale of food and beverage decreased by $23,773, or 100.00% from $23,773 for the six months ended October 31, 2024, to nil for the six months ended October 31, 2025. Our cost of revenues from sale of food and beverage primarily includes inventory costs, storage and freight costs. The decrease in our cost of revenues for sale of food and beverage was mainly due to cease of purchase orders from Costco, we did not have any orders from Costco for the six months ended October 31, 2025 and 2024.

Previous wording

Sales for the three months ended July 31, 2025 and 2024 were $2,343,959 and $2,842,608, respectively, a decrease of $498,649 or 17.54%. The decrease of sales was primarily attributed to decreased sale of food imports and distribution by $44,886, decreased consulting services by $6,989, and decreased indoor home improvement products by $446,774.

Current wording

Revenues for the six months ended October 31, 2025 and 2024 were $85,000 and $136,874, respectively, a decrease of $51,874 or 37.90%. The decrease of revenues was primarily attributed to decreased sale of food imports and distribution by $44,886 and decreased consulting services by $6,988.

Previous wording

Cost of revenues for the three months ended July 31, 2025, and 2024 was $1,349,613 and $1,444,553, respectively, a decrease of $94,940 or 6.57%. The decrease in cost of revenues in the same period of 2025 was primarily attributed to decreased cost from sale of food and beverage by $23,773, or 100.00%, decreased cost from indoor home improvement products by $45,671 or 3.27% and decreased cost from consulting service by $25,496, or 99.80%. Cost of revenues for sale of food and beverage as a percentage of total revenues was 0.00% and 0.84%, respectively, for the three months ended July 31, 2025 and 2024. Cost of revenues for indoor home improvement products as a percentage of total revenues was 57.58% and 49.08%, respectively, for the three months ended July 31, 2025 and 2024. Cost of revenues for consulting services as a percentage of total revenues was 0.002% and 0.90%, respectively, for the three months ended July 31, 2025 and 2024.

Current wording

Cost of revenues for the six months ended October 31, 2025, and 2024 was $52 and $49,281, respectively, a decrease of $49,229 or 99.89%. The decrease in cost of revenues in the same period of 2025 was primarily attributed to decreased cost from sale of food and beverage by $23,733, or 100.00% and decreased cost from consulting service by $25,496, or 99.80%. Cost of revenues for sale of food and beverage as a percentage of total revenues was 0.00% and 52.87%, respectively, for the six months ended October 31, 2025 and 2024. Cost of revenues for consulting services as a percentage of total revenues was 0.06% and 52.03%, respectively, for the six months ended October 31, 2025 and 2024.

Previous wording

The gross profit for the three months ended July 31, 2025 and 2024 was $994,346 and $1,398,055, respectively, a decrease of $403,709 or 28.88%. The blended gross profit margin was 42.42% for three months ended July 31, 2025 compared with 49.18% for the same period in 2024. Gross profit for sale of food and beverage decreased by 100.00% for three months ended July 31, 2025 due to no sales to Costco. Gross profit for sale of indoor home improvement products decreased by 29.62% for three months ended July 31, 2025 due to decreased selling price of our cabinet products. Gross profit for consulting services increased by 81.56% for three months ended July 31, 2025 .

Current wording

The gross profit for the six months ended October 31, 2025 and 2024 was $84,948 and $87,593, respectively, a decrease of $2,645 or 3.02%. The blended gross profit margin was 99.94% for the six months ended October 31, 2025 compared with 64.00% for the same period in 2024. Gross profit for sale of food and beverage decreased by 100.00% for the six months ended October 31, 2025 due to no sales to Costco. Gross profit for consulting services increased by 27.86% for the six months ended October 31, 2025.

Previous wording

Our selling expenses were $1,436,730 for the three months ended July 31, 2025, as compared to $157,729 for the three months ended July 31, 2024, representing an increase of $1,279,001, or 810.89%. The increase in the selling expenses was mainly due to (1) increased advertising and marketing expenses of $1,265,169, or 8,453.62%. To attract new customers, increase our market share and improve operation efficiency, we entered into several consulting agreements for business development, market expansion, supply chain management, and strategic financial plan and support advisory services, (2) increased payroll expenses of $12,020, or 8.71% due to increased hourly pay rate, and (3) slightly increased shipping expenses of $1,245, or 360.88% as compared to the same period in 2024 resulting from shipping costs incurred for sending product samples for exploring new products for customers; the increase in selling expenses was partly offset by decreased sales commission expenses of $1,077, or 100.00%. Selling expenses accounted for 61.30% and 5.55% of our total revenues for the three months ended July 31, 2025 and 2024, respectively.

Current wording

Our selling expenses were $1,314,168 for the six months ended October 31, 2025, compared to $60,616 for the six months ended October 31, 2024, representing an increase of $1,253,552, or 2,068.02%. The increase in the selling expenses was mainly due to (1) increased advertising and marketing expenses of $1,239,500, or 11,804.76%. To attract new customers, increase our market share and improve operation efficiency, we entered into several consulting agreements for business development, market expansion, supply chain management, and strategic financial plan and support advisory services, (2) increased payroll expenses of $12,500, or 119.05% due to increased hourly pay rate, and (3) slightly increased shipping expenses of $1,552, or 14.78% as compared to the same period in 2024 resulting from shipping costs incurred for sending product samples for exploring new products for customers. Selling expenses accounted for 1,546.08% and 44.29% of our total revenues for the six months ended October 31, 2025 and 2024, respectively.

Previous wording

The increase in general and administrative expenses was mainly due to increased professional fee by $861,593 or 228.93% as compared to the same period of 2024, resulting from increased audit, accounting and consulting expenses as a result of being a public company, and increased insurance expenses by $32,774, or 216.07% as compared to the same period in 2024, which was mainly due to increased director and officer insurance expenses. The increased general administrative expenses were partly offset by decreased payroll expenses by $25,273 or 6.01% as compared to the same period in 2024, the decrease was mainly from decreased number of employees of FuAn, and decreased meal and entertainment expenses by $40,006 or 97.07% as compared to the same period of 2024 for the purpose of saving the Company’s operating costs.

Current wording

Our general and administrative expenses were $1,752,811 for the six months ended October 31, 2025, compared to $807,751 for the six months ended October 31, 2024, reflecting an increase of $945,060 or 117.00%. The increase in general and administrative expenses was mainly due to increased professional fee by $928,935 or 178.70% as compared to the same period of 2024, resulting from increased audit, accounting and consulting expenses as a result of being a public company, and increased insurance expenses by $72,469, or 100.00% as compared to the same period in 2024, which was mainly due to increased director and officer insurance expenses. The increased general administrative expenses were partly offset by decreased payroll expenses by $58,475 or 57.94% as compared to the same period in 2024, the decrease was mainly from decreased number of employees of FuAn, and decreased meal and entertainment expenses by $34,875 or 99.95% as compared to the same period of 2024 for the purpose of saving the Company’s operating costs.

Previous wording

Other expenses were $3,998 for the three months ended July 31, 2025, compared to other expenses of $11,954 for the three months ended July 31, 2024. For the three months ended July 31, 2025, other expenses mainly consisted of interest expense of $1,962, and other expenses of $3,807, which was partly offset with other income of $1,771. For the three months ended July 31, 2024, other expenses mainly consisted of interest expense of $13,762, which was partly offset by other income $1,808.

Current wording

Other income were $15,830 for the six months ended October 31, 2025, compared to other income of nil for the six months ended October 31, 2024. For the six months ended October 31, 2025, other income mainly consisted of other income of $ 2,803 and interest income of $ 20,612, which was partly offset with other expenses of $6,832, and interest expense of $753.*** ***

Previous wording

In assessing our liquidity, we monitor and analyze our cash on-hand, our ability to generate sufficient revenue sources, the collection of our accounts receivable, our ability to obtain additional financial support in the future, and our operating and capital expenditure commitments. As reflected in our unaudited condensed consolidated financial statements, we had cash balance of approximately $0.21 million as of July 31, 2025. We also had accounts receivable, net balance of approximately $1.09 million as of July 31, 2025, among which approximately $0.3 million or 28.1% has been collected as of the date of this report.

Current wording

In assessing our liquidity, we monitor and analyze our cash on-hand, our ability to generate sufficient revenue sources, the collection of our accounts receivable, our ability to obtain additional financial support in the future, and our operating and capital expenditure commitments. As reflected in our unaudited condensed consolidated financial statements, we had cash balance of approximately $1.36 million as of October 31, 2025. We also had accounts receivable, net balance of approximately $0.17 million as of October 31, 2025, among which approximately $15,000 or 8.7% has been collected as of the date of this report.

Previous wording

Our working capital amounted to approximately $0.95 million as of July 31, 2025. Currently, we are working to improve our liquidity and capital sources primarily through cash flows from operation, debt financing, and financial support from our principal stockholder. In order to fully implement our business plan and sustain continued growth, we may also seek equity financing from outside investors.

Current wording

Our working capital amounted to approximately $2.09 million as of October 31, 2025. Currently, we are working to improve our liquidity and capital sources primarily through cash flows from operation, debt financing, and financial support from our principal stockholder. In order to fully implement our business plan and sustain continued growth, we may also seek equity financing from outside investors.

Previous wording

However, as reflected in the accompanying unaudited condensed consolidated financial statements, the Company had net loss of approximately $2.72 million for the three months ended July 31, 2025 and cash outflow from operating activities of approximately $0.10 million for the three months ended July 31, 2025. The management plans to increase its revenue of FuAn by diversifying its markets from major mass market channels to ethnic supermarkets chains. The Company expects to increase sales through FuAn’s distribution channels in the near future. The Company plans to increase Grand Forest’s revenue by providing more customized products to current customers. Also, the Company plans to expand the market for Grand Forest’s products to southern California. The Company is discussing with Los Angeles, California-based distributors about the potential opportunity of setting up a Los Angeles regional office. . The Company believes the expanded sales force will strengthen the relationship of its long-time customers based in southern California and help to increase overall sales. The Company had unsecured promissory notes with several stockholders with a total balance of $ 0.23 million as of July 31, 2025. These unsecured promissory notes are payable on demand on or after August 1, 2025, and carry no interest. In the absence of any demand, the entire principal should be due on July 31, 2029. Management also intends to raise additional funds by way of a private or public offering, or by obtaining loans from banks or others.

Current wording

However, as reflected in the accompanying unaudited condensed consolidated financial statements, the Company had net loss from continuing operations of approximately $2.97 million and net loss from discontinued operations of approximately $0.65 million for the six months ended October 31, 2025 and cash outflow from operating activities from continuing operations of approximately $0.49 million and cash inflow from operating activities from discontinued operations of approximately $0.15 million for the six months ended October 31, 2025. The management plans to increase its revenue of FuAn by diversifying its markets from major mass market channels to ethnic supermarkets chains. The Company expects to increase sales through FuAn’s distribution channels in the near future. The Company’s decision of disposing Grand Forest is to maximize the efficiency and profitability of its existing business of supply chain consulting, and supply chain services of sourcing Asian foods, snacks, and non-alcoholic beverages, and distributing branded goods to mainstream markets, grocery stores and wholesale / warehouse clubs in the US.

Previous wording

The following table summarizes our cash flows for the three months ended July 31,2025 and 2024, respectively.

Current wording

The following table summarizes our cash flows for the six months ended October 31,2025 and 2024, respectively.

Previous wording

Net cash outflow from operating activities decreased by $891,460 for the three months ended July 31, 2025 comparing with the three months ended July 31, 2024, mainly resulting from (a) increased net loss of $2,391,222 with adding-back of non-cash adjustments to net loss by 49,313, (b) decreased cash outflow on inventory by $428,069, (c) decreased cash outflow on prepaid expenses and other current assets by $3,195,078, (d) decreased payment on deferred IPO costs by $342,372, (e) decreased cash outflow on tax payable by $71,627, (f) decreased cash outflow on accrued expenses and other current liabilities by $7,915, which was partly offset by (g) increased cash outflow on operating lease liabilities by $10,282, (h) increased outstanding accounts receivable by $478,342, (i) increased cash outflow on accounts payable by $117,684, and (j) increased cash outflow on deferred revenue by $201,614.

Current wording

Net cash outflow from operating activities from continuing operations decreased by $575,637 for the six months ended October 31, 2025 comparing with the six months ended October 31, 2024, mainly resulting from (a) decreased cash outflow on prepaid expenses and other current assets by $2,640,170, (b) decreased payment on deferred IPO costs by $618,910, (c) decreased cash outflow on advance to vendor by $181,805, (d) decreased cash outflow on deferred revenue by $50,385, which was partly offset by (e) increased outstanding accounts receivable by $777,886, and (f) increased net loss from continuing operations of $2,185,516 with adding-back of non-cash adjustments to net loss by 72,773.

Previous wording

Net cash used in investing activities was $690,000 for the three months ended July 31, 2025, compared to $5,000 for the same period in 2024. The net cash used in investing activities in 2025 mainly consisted of loans made to Bio Essence totaling $690,000, comprising a $500,000 interest-bearing loan and a $190,000 non-interest-bearing advance. For the three months ended July 31, 2024, we purchased fixed assets for $5,000.

Current wording

Net cash used in investing activities from continuing operations was $330,000 for the six months ended October 31, 2025, compared to nil for the same period in 2024. The net cash used in investing activities in 2025 mainly consisted of loans made to Bio Essence Pharmaceutical totaling $330,000.

Previous wording

Net cash used in financing activities was $952,754 for the three months ended July 31, 2025, compared to net cash used in financing activities of $71,469 for the three months ended July 31, 2024. The net cash used in financing activities in 2025 mainly consisted of increased repayment of auto loan by $5,588, increased repayment to related parties by $451,019, and increased note receivable by $690,000, which was partly offset by repayment of loan from shareholder of $193,853. The net cash used in financing activities in 2024 mainly consisted of repayment of auto loan of $5,414, and repayment to related parties of $66,055.

Current wording

Net cash provided by financing activities from continuing operations was $1,607,213 for the six months ended October 31, 2025, compared to net cash used in financing activities of $501 for the six months ended October 31, 2024. The net cash provided by financing activities in 2025 mainly consisted of repayment of loan from shareholder of $193,853 and proceeds from issuance of common stock of $1,413,360. The net cash used in financing activities in 2024 mainly consisted of loan to shareholder of $501.

Previous wording

Accounts receivable represent the amounts that the Company has an unconditional right to consideration, which are stated at the historical carrying amount net of allowance for doubtful accounts. The Company maintains allowances for doubtful accounts for estimated losses. The Company reviews the accounts receivable on a periodic basis and makes allowances when there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including historical losses, the age of the receivable balance, the customer’s historical payment patterns, its current credit-worthiness and financial condition, and current market conditions and economic trends. Accounts are written off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. As of July 31, 2025 and April 30, 2025, the Company had allowance for credit losses of $557,201 and $557,201, respectively.

Current wording

Accounts receivable represent the amounts that the Company has an unconditional right to consideration, which are stated at the historical carrying amount net of allowance for doubtful accounts. The Company maintains allowances for doubtful accounts for estimated losses. The Company reviews the accounts receivable on a periodic basis and makes allowances when there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including historical losses, the age of the receivable balance, the customer’s historical payment patterns, its current credit-worthiness and financial condition, and current market conditions and economic trends. Accounts are written off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. There was no allowance for credit losses related to continuing operations as of October 31, 2025 and April 30, 2025. As of October 31, 2025 and April 30, 2025, the allowance for credit losses for discontinued operations were $557,201 and $557,201, respectively.

Previous wording

The Company derives its revenues primarily from two business segments to provide (i) food and beverage supply chain and brand management services, and (ii) indoor home improvement products to dealers and retail customers and sales of indoor home improvement products to customers.

Current wording

The Company derives its revenues primarily from two business segments to provide (i) food and beverage supply chain and brand management services, and (ii) Consulting service related to brand management.

Previous wording

For food and beverage and indoor home improvement product sales, the Company accrues estimated sales returns based on past experience and current trend of product sales. The allowance for sales returns as of July 31, 2025 and April 30, 2025 amounted to $205,988 and $205,988, respectively.

Current wording

For food and beverage, the Company accrues estimated sales returns based on past experience and current trend of product sales. There was no allowance for sales returns for continuing operations as of October 31, 2025 and April 30, 2025. As of October 31, 2025 and April 30, 2025, the allowance for sales returns for discontinued operations were $171,905 and $205,988, respectively.

Previous wording

In January 2025, the FASB issued ASU 2025-01 Income Statement-Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40). The FASB issued ASU 2024-03 on November 4, 2024-03 states that the amendments are effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Following the issuance of ASU 2024-03, the FASB was asked to clarify the initial effective date for entities that do not have an annual reporting period that ends on December 31 (referred to as non-calendar year-end entities). Because of how the effective date guidance was written, a non-calendar year-end entity may have concluded that it would be required to initially adopt the disclosure requirements in ASU 2024-03 in an interim reporting period, rather than in annual reporting period. The FASB’s intent in the basis for conclusions of ASU 2024-03 is clear that all public business entities should initially adopt the disclosure requirements in the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027.

Current wording

In January 2025, the FASB issued ASU 2025-01 Income Statement-Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40). The FASB issued ASU 2024-03 on November 4, 2024-03 states that the amendments are effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Following the issuance of ASU 2024-03, the FASB was asked to clarify the initial effective date for entities that do not have an annual reporting period that ends on December 31 (referred to as non-calendar year-end entities). Because of how the effective date guidance was written, a non-calendar year-end entity may have concluded that it would be required to initially adopt the disclosure requirements in ASU 2024-03 in an interim reporting period, rather than in annual reporting period. The FASB’s intent in the basis for conclusions of ASU 2024-03 is clear that all public business entities should initially adopt the disclosure requirements in the first annual reporting period beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact of the adoption of this standard to determine its impact on its disclosures.

Previous wording

In March 2025, the FASB issued ASU 2025-02—Liabilities (405): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 122. The amendments in this Update are effective immediately and on a fully retrospective basis to annual periods beginning after December 15, 2024. The Company is currently evaluating the effect of adoption of this standard to its consolidated financial statements and disclosures.

Current wording

In March 2025, the FASB issued ASU 2025-02—Liabilities (405): Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 122. The amendments in this Update are effective immediately and on a fully retrospective basis to annual periods beginning after December 15, 2024. The Company is currently evaluating the effect of adoption of this standard to its unaudited condensed consolidated financial statements and disclosures.