FingerMotion Inc

The following table sets out our cash and working capital as of May 31, 2024 and February 29, 2024:

At May 31, 2024, we had cash and cash equivalents of $1,064,124, as compared to cash and cash equivalents of $1,517,232 at February 29, 2024. Our mobile payment business model necessitates periodic fund deposits with our telecommunication companies to obtain access to the mobile data and talk time we make available to consumers on our portal. Additionally, our expansion into the cloud-based business, which features a longer collection cycle, has led to an increase in accounts receivable and consequently, a greater strain on our liquidity. To manage these operational demands effectively, we have had to carefully monitor and manage our cash flows. The Company otherwise does not have any planned capital expenditures and has historically funded its operations from revenues and sales of securities, including convertible debt securities. We believe that our cash on hand and cash equivalents, coupled with our operating revenues, will sufficiently cover our projected operational needs and address our outstanding liabilities for the next 12 months. For more expansive growth, further enhancing our deposits with telecommunication entities will be crucial. In line with this, we intend to continue to seek additional capital through public or private sales of our equity or debt securities, or both. We might also enter into financing arrangements with commercial banks or non-traditional lenders. We cannot provide investors with any assurance that we will be able to raise additional funding from the sale of our equity or debt securities, or both, in order to increase our deposits with our telecommunications company clients, or if available, that such funding will be on terms acceptable to us.

We did, however, as of May 28, 2024, receive $775,000 in subscription proceeds to purchase 310,000 shares of our common stock at $2.50 per share on a private placement basis. When we issue the shares pursuant to the subscription agreements, we intend to rely upon the exemption from the registration requirements of the U.S. Securities Act of 1933, as amended (the “U.S. Securities Act”) provided by Rule 903 of Regulation S promulgated under the U.S. Securities Act.

Statement of Cashflows

The following table provides a summary of cash flows for the periods presented:

Cash Flow used in Operating Activities

Net cash used in operating activities decreased by $1,168,012 in the three months ended May 31, 2024 compared to the three months ended May 31, 2023, primarily due to an increase in account receivable of ($7,762,176) (May 31, 2023: ($322,774)), increase in other receivable of ($150,316) (May 31, 2023: ($1,659,906)); offset by decrease in prepayment and deposit of $24,000 (May 31, 2023: $899,836), increase in accounts payable of $6,884,661 (May 31, 2023: $32,328), increase in accrual and other payable of $833,177 (May 31, 2023: ($645,872)) and increase in lease liability of $12,006 (May 31, 2023: ($1,188)).

Cash Flow used in Investing Activities

During the three months ended May 31, 2024, net cash used in investing activities decreased by $380 compared to $380 in the three months ended May 31, 2023.

Cash Flow provided by Financing Activities

During the three months ended May 31, 2024, net cash provided by financing activities was $775,000 compared to net cash used by financing activities during the three months ended May 31, 2023 of $1,075,333. The increase was due to the receipt of subscription proceeds to purchase 310,000 shares of our common stock at $2.50 per share on a private placement basis.

Off-Balance Sheet Arrangements

There are no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Subsequent Events

On June 1, 2024, the Company’s wholly owned subsidiary, Finger Motion Company Limited (the “Borrower”), entered into a loan agreement with Dr. Liew Yow Ming (the “Lender”) whereby the Lender agreed to advance a short-term loan facility of SGD$370,000 (the “Loan”) to the Borrower for working capital purposes. As of the date hereof, the full amount of the Loan has been drawn upon by the Borrower. Each drawdown portion of the Loan is due one (1) year from the date of the drawdown, unless extended by the Lender. If the Lender agrees, the Borrower may prepay the whole or any part of the Loan by providing the Lender not less than three (3) business days prior written notice and subject to payment of interest accrued thereon. Any prepayment of the Loan shall be in an amount of SGD$50,000 or multiples thereof. The Loan shall bear interest at the rate of 1.67% per month, any such interest to accrue from day to day and to be calculated based on a 365-day year, and is payable on a monthly basis on or before the last day of each successive month.

Other than the above, we have determined that we do not have any material subsequent events to report.

Critical Accounting Policies

For a complete summary of all our significant accounting policies refer to Note 2 - Summary of Principal Accounting Policies of the Notes to the Consolidated Financial Statements as presented under Item 8, Financial Statements and Supplementary Data in our Annual Report on Form 10-K for our fiscal year ended February 29, 2024 filed with the SEC on May 29, 2024.

Refer to “Critical Accounting Policies” under Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for our fiscal year ended February 29, 2024 filed with the SEC on May 29, 2024.

Recently Issued Accounting Pronouncements

The Company does not believe recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the consolidated financial position, statements of operations and cash flows.