FingerMotion Inc

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

At August 31, 2024, we had cash and cash equivalents of $810,284, 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. We believe that our cash on hand and cash equivalents, along with our revenues from operations, will fund our core operations and repay our outstanding indebtedness for at least the next 12 months. However, we anticipate the need for additional capital to support the rollout of our Command & Communication business as well for more continued growth, increasing our deposits with telecommunication entities will be crucial. To support all these, we intend to continue to seek additional capital through public or private sales of our equity or debt securities, or both. We may also explore entering 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 support the rollout of our Command & Communication business and 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 August 31, 2024, receive $1,605,000 in subscription proceeds to purchase 1,070,000 shares of our common stock at $1.50 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 $1,969,990 in the six months ended August 31, 2024 compared to the six months ended August 31, 2023, primarily due to an increase in account receivable of ($12,209,223) (August 31, 2023: ($7,292,931)) and increase in prepayment and deposit of ($22,226) (August 31, 2023: $329,727); offset by decrease in other receivable of $527,972 (August 31, 2023: ($2,067,397)), increase in accounts payable of $10,002,702 (August 31, 2023: $5,327,561), increase in accrual and other payable of $1,369,869 (August 31, 2023: ($434,852)) and increase in lease liability of $11,448 (August 31, 2023: ($2,673)).

Cash Flow used in Investing Activities

During the six months ended August 31, 2024, net cash used in investing activities increased by $1,369 compared to $372 in the six months ended August 31, 2023.

Cash Flow provided by Financing Activities

During the six months ended August 31, 2024, net cash provided by financing activities was $2,629,688 compared to net cash used by financing activities during the six months ended August 31, 2023 of $295,333. The increase was due to the receipt of subscription proceeds to purchase 1,070,000 shares of our common stock at $1.50 per share on a private placement basis and short-term loan facility of SGD$1,370,000.

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 September 4, 2024, the remaining SGD$500,000 of the SGD$1,500,000 Loan has been fully drawn upon by our wholly owned subsidiary, Finger Motion Company Limited.

On October 11, 2024, we issued 1,095,000 shares of common stock to 15 individuals due to the closing of our private placement at $1.50 per share for gross proceeds of $1,642,500. In connection with the closing of the private placement, we paid cash finder’s fees of an aggregate of $158,000 to three individuals.

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.