NETSOL TECHNOLOGIES INC

On May 3, 2024, the SEC (“the Commission”) issued an order whereby the Company’s then auditor, BF Borgers CPA PC (“Borgers”) was banned from appearing or practicing before the Commission as an accountant. This ban results in Borgers being unable to perform the audit or review of financial information included in Commission filings. Issuers who are clients of Borgers were advised that they must: a) engage a new qualified, independent, PCAOB-registered public accountant; (b) may not present financial information that has been reviewed by Borgers in its quarterly reports; and, (c) may not include audit reports from Borgers in its 10-K filings. Further, the Commission advised issuers to consider whether their filings may need to be amended to address any reporting deficiencies arising from the Borgers engagement.

The Company filed an 8-K on May 6, 2024 announcing the dismissal of Borgers and the engagement of a new, independent PCAOB-registered public accountant, Fortune CPA, Inc. (“Fortune”) by the audit committee and board of directors of the Company. Fortune has been engaged to conduct a review for the nine months ending March 31, 2024, to audit the year ending June 30, 2024 and to re-audit the year ending June 30, 2023. While the Company believes that its internal controls and procedures used in preparing its reports were effective in its reporting, there is a risk that Fortune may discover discrepancies during the course of its audit of the years ending June 30, 2024 and 2023 that require an amendment of the Company’s financial statements.

Other than as stated above, as of the date of this Quarterly Report on Form 10-Q, there have been no material changes from the risk factors disclosed in our Annual Report on Form 10-K for the year ended June 30, 2023, filed with the SEC on September 22, 2023. Any of such factors could result in a significant or material adverse effect on our result of operations or financial conditions. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. We may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.