FG Communities Holdings Inc.

To the Stockholders and Board of Directors

Fundamental Global Inc.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Fundamental Global Inc. (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive loss, shareholders’ equity, and cash flows for each of the years then ended, and the related notes (collectively, the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2024 and 2023, and the consolidated results of its operations and its cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles.

Emphasis-of-Matters

As summarized in Note 4 to the consolidated financial statements, FG Financial Group, Inc. (“FGF”) completed a merger transaction with FG Group Holdings, Inc. (“FGH”) on February 29, 2024, pursuant to which FGH common stockholders received one share of FGF’s common stock for each share of common stock of FGH held by such stockholder. The merger was accounted for as a reverse acquisition in accordance with ASC 805 Business Combinations (“ASC 805”). As a result, FGF was identified as the acquiree for accounting purposes and FGH was identified as the acquirer for accounting purposes. FGH’s assets, liabilities and results of operations are included in the consolidated financial statements at their historical carrying values since incorporation. FGF’s assets, liabilities and results of operations have been included from February 29, 2024. As a result, the 2023 comparative information included herein is solely that of FGH. Upon completion of the merger, the combined company was renamed to Fundamental Global Inc.

As summarized in Note 1 to the consolidated financial statements, the Company and Strong Global Entertainment, Inc. (“SGE”) entered into a definitive arrangement agreement to combine the companies in an all-stock transaction. Upon completion of the arrangement, the stockholders of SGE received 1.5 common shares of the Company for each share of SGE. The transaction closed on September 30, 2024. The financial results of SGE are presented on a consolidated basis in the Company’s consolidated financial statements.

As summarized in Note 5 to the consolidated financial statements, the Company sold one of its indirect wholly-owned subsidiaries, Strong/MDI Screen Systems, Inc. (“Strong/MDI”) and completed the transaction on September 25, 2024. Management evaluated and determined that all of the criteria to report the transaction as a discontinued operation were met. As a result, the financial results for Strong/MDI have been presented as discontinued operations for all periods presented in the consolidated financial statements.

As summarized in Note 5 to the consolidated financial statements, the board of directors of the Company approved the Company’s plan to sell its reinsurance business on December 31, 2024 and authorized management to proceed with such plan. Management evaluated and determined that all of the criteria to report the transaction as a discontinued operation were met. As a result, the financial results for the reinsurance business have been presented as discontinued operations for all periods presented in the consolidated financial statements.

As summarized in Note 1 to the consolidated financial statements, the Company effected a reverse stock split of the Company’s authorized, issued and outstanding shares of common stock at a ratio of one (1)-for-twenty-five (25) on October 31, 2024. All share information presented in the consolidated financial statements have been appropriately retrospectively adjusted to reflect the effects of the reverse stock split.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Valuation of Equity Holdings – Refer to Note 6

Critical Audit Matter Description

The Company’s equity holdings comprise a significant portion of its total assets as of the merger transaction between FGF with FGH on February 29, 2024 and as of December 31, 2024, and management uses several methods of accounting to determine the appropriate value for each of its holdings based on management’s evaluation of current facts and circumstances. The valuation model on the Company’s holdings measured at the estimated fair value involve key inputs, assumptions, and methodologies, that can be considered highly subjective and judgmental.

Our assessment of management’s calculation of the appropriate valuations for the Company’s equity holdings is significant to our audit because equity holdings are material to the consolidated financial statements and management’s assessment process involves significant judgment.

How the Critical Audit Matter Was Addressed in the Audit

Our principal audit procedures related to the Company’s equity holdings included the following:

Valuation of Reinsurance Loss and Loss Adjustment Expense Reserves – Refer to Note 5

Critical Audit Matter Description

Loss and loss adjustment expense reserve estimates are based primarily on estimates derived from reports the Company has received from their cedants and their actuarial specialist. The Company also engages an independent actuarial specialist in order to assist management in establishing reasonable reserves. The estimate of loss reserves relies on significant key inputs, assumptions, and methodologies, including (1) the types of exposures and projected ultimate premium to be written by cedents; (2) expected loss ratios by type of business; (3) actuarial methodologies which leverage loss reporting and payment experience, reports from ceding companies and historical trends; and (4) general economic conditions.

We identified the actuarial methodologies and significant assumptions used in the estimation of the Company’s loss and loss adjustment expense reserves as a critical audit matter. The principal considerations for this determination were (i) the significant assumptions and inputs used by management and their specialists when developing their estimate, (ii) the significant auditor subjectivity and judgment involved in evaluating the audit evidence related to the actuarial methodologies used, and (iii) the extent of specialized skills and knowledge needed from our actuarial specialist.

Our principal audit procedures related to the Company’s loss and loss adjustment expense reserves included the following:

HASKELL & WHITE LLP

We have served as the Company’s auditor since 2019.

Irvine, California

March 31, 2025