KNOW LABS INC

To the Board of Directors and Stockholders of

Know Labs, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Know Labs, Inc. and its subsidiaries (the Company) as of September 30, 2024 and 2023, and the related consolidated statements of operations, stockholders’ (deficit) equity, and cash flows for each of the two years in the period ended September 30, 2024, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of September 30, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended September 30, 2024 in conformity with the accounting principles generally accepted in the United States of America.

Going Concern

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has suffered recurring losses from operations and has an accumulated deficit that raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

These consolidated financial statements are the responsibility of the entity’s management. Our responsibility is to express an opinion on these 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 audit 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 entity’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 Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the 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.

Accounting for the Issuance of Convertible Debt and Warrants

As described in Notes 6 and 7 to the consolidated financial statements, on February 27, 2024, the Company entered into a securities purchase agreement involving the issuance of senior convertible notes and warrants. The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives requiring bifurcation in accordance with ASC Topic 815, Derivatives and Hedging. The Company concluded that the warrants issued on February 27, 2024 met the requirements for equity classification. The Company allocated the face value and the issuance costs to the convertible notes and the warrants based on their relative fair values.

The principal considerations for our determination that performing procedures related to the issuance of the convertible debt and warrants is a critical audit matter are due to the complexity of these transactions and the significant estimates involved, as well as the nature and extent of audit effort required to obtain sufficient appropriate audit evidence to address the risks of material misstatements related to the classification and valuation of the allocation between the convertible debt and warrants. The nature and extent of audit effort required to address the matter includes involvement of more experienced engagement team members and discussions related to the matter.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included inspecting the securities purchase agreement to identify relevant terms and conditions that affect whether the warrants are derivatives or contain features that qualify as embedded derivatives, evaluating whether the warrants are derivatives or contain features that qualify as embedded derivatives, obtaining an understanding of the process of estimating the fair value of the instruments and utilizing personnel with specialized knowledge and skill in the relevant technical accounting guidance to evaluate the appropriateness of the Company’s application of the relevant technical guidance. Our procedures also included reviewing the calculation of the allocation of the relative fair value of the convertible notes and warrants and amortization of the related issuance costs.

/s/BPM LLP

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

Santa Rosa, California

November 14, 2024