Financial Performance - The company reported a revenue of approximately $1.2 million for the fiscal year ended October 31, 2023, which is an 8.0% decrease from $1.4 million in the previous year [1][3] - Total operating expenses decreased by 33.6% to $4.3 million from $6.4 million in the prior year [2][3] - Loss from operations narrowed by 40.5% to $3.0 million compared to $5.1 million in the previous year [2][3] - The net loss decreased by 47.6% to $2.5 million from $4.7 million in the prior year [2][3] Business Segments - The company experienced a significant increase of approximately $612,000 in commissions from liability insurance products, indicating growth in this segment despite overall revenue decline [1] Shareholder Information - Loss per share improved to $3.87 from $9.03 in the previous year, reflecting a 55.4% reduction [2]

Introduction [Company Structure and Operations](index=5&type=section&id=Company%20Structure%20and%20Operations) The company operates in the PRC through a VIE structure, controlling its Chinese operating entity (TRX ZJ) contractually, exposing investors to unique risks - The Company is a Cayman Islands holding company, not a Chinese operating company, and conducts its business through a VIE structure in the PRC[6](index=6&type=chunk) - Control over the VIE (TRX ZJ) is established through contractual VIE Agreements, enabling the consolidation of financial results under U.S. GAAP. However, these agreements have not been tested in a Chinese court[6](index=6&type=chunk) - Investors own equity in the Cayman Islands holding company, not in the PRC-based VIE, exposing them to risks associated with the VIE structure[6](index=6&type=chunk) - The company's business is conducted in Renminbi (RMB), while its consolidated financial statements are presented in United States dollars, creating exposure to currency exchange rate fluctuations[8](index=8&type=chunk) Forward-Looking Information [Forward-Looking Statements Disclosure](index=7&type=section&id=Forward-Looking%20Statements%20Disclosure) This section details forward-looking statements on future performance and strategies, subject to various risks and uncertainties, with no obligation to update - The report includes forward-looking statements concerning future financial results, growth strategies, and economic conditions[11](index=11&type=chunk) - Key areas covered by forward-looking statements include revenue projections, growth execution, competition, the future of the Chinese insurance industry, and the stability of the VIE structure[11](index=11&type=chunk) - The company warns that these statements involve risks and uncertainties, and actual results may differ materially. It does not commit to updating forward-looking statements unless required by law[12](index=12&type=chunk)[15](index=15&type=chunk) PART I [Key Information](index=8&type=section&id=Item%203.%20KEY%20INFORMATION) This section details the company's Cayman Islands holding structure and reliance on a VIE for PRC operations, highlighting associated legal, regulatory, and financial risks - The company operates as a Cayman Islands holding company controlling its PRC operations through a VIE structure, which involves unique risks as investors do not own equity in the Chinese operating entity[16](index=16&type=chunk)[17](index=17&type=chunk) - The company is subject to risks from recent PRC regulatory actions, including those related to cybersecurity and overseas listings, although it states these have not impacted its operations as of the report date[19](index=19&type=chunk) - Cash transfers between the holding company, subsidiaries, and the VIE are detailed, noting that PRC government controls on currency conversion could restrict the ability to fund operations outside of China or pay dividends[21](index=21&type=chunk)[22](index=22&type=chunk) - The company's auditor, RBSM LLP, is a U.S.-based firm regularly inspected by the PCAOB, and is not currently affected by the Holding Foreign Companies Accountable Act. However, future inspection issues could lead to delisting[20](index=20&type=chunk) [Selected Condensed Consolidating Financial Schedule](index=11&type=section&id=Selected%20Condensed%20Consolidating%20Financial%20Schedule) This section presents condensed consolidating financial schedules for the Cayman parent, subsidiaries, and VIE for FY2021-2023, showing most financial activity within the PRC VIE structure Condensed Consolidating Balance Sheet as of October 31, 2023 (in $) | Entity | Total Assets | Total Liabilities | Total Equity | | :--- | :--- | :--- | :--- | | TRX (Cayman Islands) | 34,289,999 | 1,873,093 | 32,416,906 | | Subsidiary (Hong Kong) | 14,268,263 | 7,501,149 | 6,767,114 | | WFOE (PRC) | (842,405) | 492,358 | (1,334,763) | | VIE and Subsidiaries (PRC) | 27,663,627 | 290,935 | 27,372,692 | | **Consolidated Total** | **35,479,774** | **3,062,868** | **32,416,906** | Condensed Consolidating Statement of Operations for the Year Ended October 31, 2023 (in $) | Entity | Revenues | Loss from operations | Net (Loss) Income | | :--- | :--- | :--- | :--- | | TRX (Cayman Islands) | — | (2,773,070) | (2,453,982) | | Subsidiary (Hong Kong) | — | — | 319,088 | | WFOE (PRC) | — | (40,605) | 284,399 | | VIE and Subsidiaries (PRC) | 1,244,247 | (202,651) | — | | **Consolidated Total** | **1,244,247** | **(3,016,326)** | **(2,453,982)** | Condensed Consolidating Statement of Cash Flows for the Year Ended October 31, 2023 (in $) | Entity | Net cash from operating | Net cash from investing | Net cash from financing | | :--- | :--- | :--- | :--- | | TRX (Cayman Islands) | — | — | — | | Subsidiary (Hong Kong) | 300,000 | (300,591) | — | | WFOE (PRC) | (14,464) | 14,019 | — | | VIE and Subsidiaries (PRC) | 708,485 | (692,717) | — | | **Consolidated Total** | **994,021** | **(992,717)** | **—** | [Risk Factors](index=17&type=section&id=D.%20Risk%20Factors) This section outlines principal risks, including business competition, VIE structure enforceability, PRC government intervention, and share-related market volatility and dual-class structure - **Business Risks:** The company has a limited operating history, faces intense competition, and its revenue is dependent on commission rates set by insurance companies, which can decrease[41](index=41&type=chunk) - **Corporate Structure Risks:** The VIE structure is a primary risk, as the agreements may not be enforceable under PRC law. If the government deems the structure non-compliant, the company could face severe penalties, and shares could become worthless[44](index=44&type=chunk)[86](index=86&type=chunk) - **China-Related Risks:** The PRC government exerts substantial influence and may intervene in operations at any time. Changes in laws regarding foreign investment, data security (CAC), and overseas listings (CSRC) create significant uncertainty[47](index=47&type=chunk)[121](index=121&type=chunk)[173](index=173&type=chunk) - **Market & Share Risks:** The company is an emerging growth company and a foreign private issuer, exempting it from certain U.S. disclosure and governance standards. The dual-class share structure concentrates voting power with a single controlling shareholder[54](index=54&type=chunk)[55](index=55&type=chunk)[103](index=103&type=chunk) - The company has identified material weaknesses in its internal control over financial reporting, including a lack of personnel with U.S. GAAP knowledge and a lack of formal disclosure controls[116](index=116&type=chunk)[118](index=118&type=chunk) [Information on the Company](index=49&type=section&id=Item%204.%20INFORMATION%20ON%20THE%20COMPANY) This section provides a comprehensive overview of TIAN RUIXIANG Holdings Ltd, detailing its history, insurance brokerage operations in China via a VIE, and regulatory environment - The company operates as an insurance brokerage in China through its VIE, TRX ZJ, distributing property & casualty and other insurance products from over 30 insurance company partners[217](index=217&type=chunk)[218](index=218&type=chunk) - The company's online platform, Needbao, was unsuccessful due to the impact of COVID-19, leading to an impairment loss of **$123,646** in fiscal year 2022[71](index=71&type=chunk)[234](index=234&type=chunk) - The company's corporate structure relies on a series of VIE agreements (Exclusive Business Cooperation, Equity Pledge, Exclusive Option to Purchase, and Proxy Agreement) to control its PRC operating entity, TRX ZJ[318](index=318&type=chunk) - The insurance industry in the PRC is highly regulated, with the National Financial Regulatory Administration (NFRA) replacing the CBIRC in 2023 as the primary supervisory body[261](index=261&type=chunk)[272](index=272&type=chunk) [History and Development of the Company](index=49&type=section&id=A.%20History%20and%20Development%20of%20the%20Company) This section traces the company's corporate history, from the VIE entity's formation in 2010 to the Cayman Islands holding company's establishment and its Nasdaq IPO in January 2021 - The VIE entity, TRX ZJ, was formed in 2010. The current management team's involvement began in May 2016[210](index=210&type=chunk) - The Cayman Islands holding company, TRX, was established on March 5, 2019, followed by the creation of its Hong Kong subsidiary and PRC WFOE[211](index=211&type=chunk) - The company's Class A Ordinary Shares commenced trading on the Nasdaq Capital Market under the symbol "TIRX" on January 27, 2021[212](index=212&type=chunk) [Business Overview](index=52&type=section&id=B.%20Business%20Overview) The company operates as an insurance broker in China via its VIE, distributing various insurance products, with FY2023 revenue decreasing by **8.0%** to **$1.24 million** Revenue by Insurance Product Commissions (FY2021-FY2023) | Product Category | 2023 Commissions ($) | 2022 Commissions ($) | 2021 Commissions ($) | | :--- | :--- | :--- | :--- | | **Property & Casualty** | | | | | Automobile Insurance | 6,103 | 134,718 | 434,793 | | Commercial Property Ins. | 151,013 | 382,180 | 213,204 | | Liability Insurance | 975,460 | 363,899 | 1,588,818 | | Accidental Insurance | 20,361 | 255,218 | 356,156 | | **Other Insurance** | | | | | Life Insurance | 576 | 20,489 | 70,336 | | Health Insurance | 49,712 | 25,524 | 3,747 | | Miscellaneous Insurance | 41,022 | 142,627 | 8,557 | | **Total Commissions** | **$1,244,247** | **$1,324,655** | **$2,675,611** | - In FY2023, revenue concentration was high, with the top three insurance partners accounting for **32.1%**, **28.0%**, and **10.5%** of total revenues, respectively[219](index=219&type=chunk)[244](index=244&type=chunk) - The company discontinued its institutional risk management services in November 2022 due to diminished demand[217](index=217&type=chunk)[233](index=233&type=chunk) - The company's distribution network includes **155 sales professionals** and **seven branch offices** in major Chinese cities as of June 1, 2024[235](index=235&type=chunk) [Organizational Structure](index=72&type=section&id=C.%20Organizational%20Structure) The company's organizational structure centers on a VIE model, where the Cayman Islands parent controls PRC operations through contractual agreements with its WFOE and the VIE (TRX ZJ) - The company controls its PRC operating entity, TRX ZJ, through a series of VIE agreements entered into on May 20, 2019[318](index=318&type=chunk) - **Exclusive Business Cooperation and Service Agreement:** WFOE provides exclusive technical and management services to TRX ZJ in exchange for service fees equal to TRX ZJ's net income[323](index=323&type=chunk) - **Equity Interest Pledge Agreement:** The shareholder of TRX ZJ has pledged all its equity interests to WFOE to guarantee the performance of the service agreement[325](index=325&type=chunk) - **Share Disposal and Exclusive Option to Purchase Agreement:** WFOE holds an exclusive option to purchase all or part of the equity interests in TRX ZJ for a nominal price, subject to PRC law[328](index=328&type=chunk) - **Proxy Agreement:** The shareholder of TRX ZJ has irrevocably granted all shareholder rights, including voting rights, to WFOE[330](index=330&type=chunk) [Operating and Financial Review and Prospects](index=76&type=section&id=Item%205.%20OPERATING%20AND%20FINANCIAL%20REVIEW%20AND%20PROSPECTS) This section provides management's discussion and analysis of financial condition and operations for FY2021-2023, showing revenue decreased to **$1.24 million** in FY2023, while net loss improved to **$2.45 million** Consolidated Results of Operations Summary (FY2021-FY2023) | Metric | FY 2023 ($) | FY 2022 ($) | FY 2021 ($) | | :--- | :--- | :--- | :--- | | **Revenues** | 1,244,247 | 1,351,909 | 2,790,617 | | **Loss from Operations** | (3,016,326) | (5,068,914) | (2,253,804) | | **Net Loss** | (2,453,982) | (4,684,189) | (1,944,577) | | **Comprehensive Loss** | (2,515,116) | (8,401,667) | (1,730,454) | - FY2023 revenue decreased by **8.0%** YoY due to lower commissions from automobile, commercial property, and accidental insurance, partially offset by a significant increase in liability insurance commissions[365](index=365&type=chunk) - General and administrative expenses decreased by **60.9%** in FY2023, primarily due to a **$2.23 million** reduction in compensation and benefits, including lower stock-based compensation[370](index=370&type=chunk)[372](index=372&type=chunk) - As of October 31, 2023, the company had approximately **$695,000** in cash and restricted cash and **$26.8 million** in short-term investments, which management believes is sufficient to meet cash requirements for the next twelve months[408](index=408&type=chunk)[425](index=425&type=chunk)[426](index=426&type=chunk) [Directors, Senior Management and Employees](index=96&type=section&id=Item%206.%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20EMPLOYEES) This section details the company's leadership, compensation, board practices, and employee structure, including executive compensation and the dual-class share structure - Sheng Xu has served as the CEO and Chairman of the board since April 2024[434](index=434&type=chunk) FY2023 Named Executive Officer Compensation | Name and Principal Position | Salary (US$) | Total (US$) | | :--- | :--- | :--- | | Zhe Wang (former CEO, Chairman) | 150,000 | 150,000 | | Mingxiu Luan (CFO) | 80,000 | 80,000 | - The company has two share incentive plans: the 2021 Plan (**200,000 Class A shares** authorized) and the 2023 Plan (**1,000,000 Class A shares** authorized)[445](index=445&type=chunk)[449](index=449&type=chunk) - As of June 1, 2024, the company had **8 employees** and **152 contractual sales agents**[464](index=464&type=chunk) - Unitrust Holdings Limited holds all **50,000 Class B Ordinary Shares**, representing **33.43%** of the total voting power due to the **18-to-1** voting ratio of Class B to Class A shares[468](index=468&type=chunk)[470](index=470&type=chunk) [Major Shareholders and Related Party Transactions](index=104&type=section&id=Item%207.%20MAJOR%20SHAREHOLDERS%20AND%20RELATED%20PARTY%20TRANSACTIONS) This section details major shareholders and related party transactions, including VIE contractual arrangements, working capital borrowings, and balances due to/from related parties - The company's operations are controlled through VIE contractual arrangements with TRX ZJ, which is a related party transaction[471](index=471&type=chunk) - In FY2023, the company borrowed **$9,535** from and repaid **$9,818** to related parties for working capital needs. These borrowings are non-interest bearing and unsecured[473](index=473&type=chunk) Due to Related Parties (as of Oct 31, 2023) | Related Party | Amount Due ($) | | :--- | :--- | | Baohai Xu (Manager) | 321,385 | | Zhe Wang (Former CEO) | 120,985 | | Sheng Xu (CEO) | 110,362 | | Mufang Gao (Mother of former CEO) | 310,771 | | Feng'e Feng (Mother of CEO) | 186,571 | | Mingxiu Luan (CFO) | 123,436 | | **Total** | **$1,173,510** | [Financial Information](index=105&type=section&id=Item%208.%20FINANCIAL%20INFORMATION) This section confirms appended consolidated financial statements, states no material legal proceedings, and outlines the dividend policy of retaining earnings for expansion - The company is not currently involved in any material legal or administrative proceedings[481](index=481&type=chunk) - The company has no present plan to pay cash dividends and intends to retain future earnings for business operations and expansion[482](index=482&type=chunk) - As a holding company, its ability to pay dividends depends on receiving funds from its PRC subsidiary, which is subject to PRC regulations on profit distribution and currency exchange[482](index=482&type=chunk) [The Offer and Listing](index=106&type=section&id=Item%209.%20THE%20OFFER%20AND%20LISTING) This section details the trading of the company's Class A Ordinary Shares on the Nasdaq Capital Market under the ticker symbol "TIRX" since January 27, 2021 - The company's Class A Ordinary Shares are listed on the Nasdaq Capital Market under the symbol "TIRX"[485](index=485&type=chunk)[486](index=486&type=chunk) - The listing has been active since January 27, 2021[485](index=485&type=chunk) [Additional Information](index=107&type=section&id=Item%2010.%20ADDITIONAL%20INFORMATION) This section provides further details on corporate governance, including the dual-class share structure, a material acquisition contract, and taxation considerations in the Cayman Islands, PRC, and U.S - The company has a dual-class share structure: Class A Ordinary Shares have one vote per share, while Class B Ordinary Shares have **18 votes per share**[489](index=489&type=chunk) - In February 2024, the company's Hong Kong subsidiary entered into an agreement to acquire Peak Consulting Services Limited, a licensed insurance brokerage in Hong Kong, for **$1.5 million** paid in Class A Ordinary Shares[514](index=514&type=chunk) - The Cayman Islands levies no corporate or income taxes. PRC taxation includes a potential **10%** withholding tax on dividends paid from the PRC subsidiary[517](index=517&type=chunk)[519](index=519&type=chunk) - There is a risk that the company could be classified as a PRC "resident enterprise," which would subject its global income to PRC taxes and could result in PRC withholding tax on dividends paid to non-PRC shareholders[520](index=520&type=chunk)[523](index=523&type=chunk) - For U.S. investors, the company does not expect to be a Passive Foreign Investment Company (PFIC), but this is a factual determination made annually and is subject to change[536](index=536&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=119&type=section&id=Item%2011.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company is exposed to market risks including interest rate, credit, liquidity, and significant foreign exchange risk due to RMB-denominated revenues and U.S. dollar reporting - The company's primary market risks include interest rate risk, credit risk, liquidity risk, and foreign exchange risk[544](index=544&type=chunk)[545](index=545&type=chunk)[546](index=546&type=chunk)[547](index=547&type=chunk) - Foreign exchange risk is significant because revenues and expenses are denominated in RMB, while financial statements are reported in U.S. dollars. A depreciating RMB would negatively impact reported results[547](index=547&type=chunk) - The company has not entered into any hedging transactions to mitigate its exposure to foreign exchange risk[547](index=547&type=chunk) [Description of Securities Other Than Equity Securities](index=119&type=section&id=Item%2012.%20DESCRIPTION%20OF%20SECURITIES%20OTHER%20THAN%20EQUITY%20SECURITIES) This section indicates the company has no debt securities, warrants, rights, or other securities to describe under this item - The company reports no debt securities, warrants, rights, or other securities under this item[547](index=547&type=chunk)[548](index=548&type=chunk) PART II [Defaults, Dividend Arrearages and Delinquencies](index=120&type=section&id=Item%2013.%20DEFAULTS%2C%20DIVIDEND%20ARREARAGES%20AND%20DELINQUENCIES) The company reports no defaults, dividend arrearages, or delinquencies during the reporting period - The company has no defaults, dividend arrearages, or delinquencies to report[548](index=548&type=chunk) [Material Modifications to the Rights of Security Holders and Use of Proceeds](index=120&type=section&id=Item%2014.%20MATERIAL%20MODIFICATIONS%20TO%20THE%20RIGHTS%20OF%20SECURITY%20HOLDERS%20AND%20USE%20OF%20PROCEEDS) This section reports no material modifications to security holder rights and details the use of proceeds from the January 2021 IPO and June 2021 follow-on offerings - There have been no material modifications to the rights of security holders[548](index=548&type=chunk) - The company raised net proceeds of approximately **$10.01 million** from its IPO in January 2021 and has used **$2.33 million** for general operating purposes[549](index=549&type=chunk) - An additional **$22.2 million** in net proceeds was raised from follow-on offerings in June 2021, which remains unspent as of the report date[550](index=550&type=chunk) [Controls and Procedures](index=121&type=section&id=Item%2015.%20CONTROLS%20AND%20PROCEDURES) Management concluded that disclosure controls and procedures were ineffective as of October 31, 2023, due to material weaknesses in internal control over financial reporting, with remediation efforts underway - Management concluded that as of October 31, 2023, the company's disclosure controls and procedures were not effective[552](index=552&type=chunk) - Material weaknesses in internal control were identified, including: (1) a lack of accounting personnel with knowledge of U.S. GAAP and SEC reporting requirements; (2) a lack of formal disclosure controls and procedures; and (3) a lack of a comprehensive accounting policies and procedures manual[556](index=556&type=chunk) - Significant deficiencies identified include a lack of formal internal controls over financial closing and a lack of a formal risk assessment process[556](index=556&type=chunk) - The company is undertaking remedial measures, including preparing an accounting manual and establishing formal control and risk assessment processes[557](index=557&type=chunk) [Other Information](index=122&type=section&id=Item%2016.%20Other%20Information) This section covers governance and compliance, including the audit committee financial expert, code of ethics, principal accountant fees, foreign private issuer corporate governance, and cybersecurity risk management - The board has designated Jingyu Li as the audit committee financial expert[561](index=561&type=chunk) Principal Accountant Fees (RBSM LLP) | Service | FY 2023 (US$) | FY 2022 (US$) | | :--- | :--- | :--- | | Audit Fees | 365,000 | 365,000 | | Audit-Related Fees | — | — | | Tax Fees | — | — | | Other fees | — | — | | **Total** | **365,000** | **365,000** | - As a foreign private issuer, the company follows Cayman Islands corporate governance practices, which do not require shareholder approval for certain equity issuances that would be required for U.S. domestic companies under Nasdaq rules[568](index=568&type=chunk) - The company has implemented a cybersecurity risk management process and reports no material cybersecurity incidents to date[572](index=572&type=chunk) PART III [Financial Statements](index=124&type=section&id=Item%2018.%20FINANCIAL%20STATEMENTS) This section contains the audited consolidated financial statements for FY2021-2023, prepared under U.S. GAAP, including balance sheets, statements of operations, and cash flows, with an unqualified auditor's opinion [Consolidated Balance Sheets](index=130&type=section&id=Consolidated%20Balance%20Sheets) The consolidated balance sheets show total assets of **$35.48 million** in 2023, dominated by short-term investments, with total liabilities increasing to **$3.06 million** and total equity slightly decreasing Consolidated Balance Sheet Highlights (in U.S. Dollars) | Account | As of Oct 31, 2023 | As of Oct 31, 2022 | | :--- | :--- | :--- | | **Total Current Assets** | 27,618,624 | 34,858,624 | | **Total Assets** | **35,479,774** | **35,030,828** | | **Total Current Liabilities** | 3,062,868 | 1,494,088 | | **Total Liabilities** | **3,062,868** | **1,548,806** | | **Total Equity** | **32,416,906** | **33,482,022** | [Consolidated Statements of Operations and Comprehensive Loss](index=131&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For FY2023, total revenues were **$1.24 million**, with a net loss of **$2.45 million**, representing a significant improvement from the prior year's **$4.68 million** loss Consolidated Operations Highlights (in U.S. Dollars) | Metric | FY 2023 | FY 2022 | FY 2021 | | :--- | :--- | :--- | :--- | | Total Revenues | 1,244,247 | 1,351,909 | 2,790,617 | | Loss from Operations | (3,016,326) | (5,068,914) | (2,253,804) | | Net Loss | (2,453,982) | (4,684,189) | (1,944,577) | | Net Loss Per Share | (3.87) | (9.03) | (5.65) | [Consolidated Statements of Cash Flows](index=133&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For FY2023, net cash provided by operating activities was **$994,304**, a significant turnaround from the prior year's usage, with net cash used in investing activities at **$992,717** Consolidated Cash Flow Highlights (in U.S. Dollars) | Cash Flow Activity | FY 2023 | FY 2022 | FY 2021 | | :--- | :--- | :--- | :--- | | Net Cash from Operating Activities | 994,304 | (198,760) | (1,363,938) | | Net Cash from Investing Activities | (992,717) | (28,897,466) | (7,503,411) | | Net Cash from Financing Activities | (283) | — | 32,642,481 | | **Net Change in Cash** | **(167)** | **(30,148,399)** | **23,920,146** | [Notes to Consolidated Financial Statements](index=134&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, including VIE consolidation and revenue recognition, along with explanations of VIE agreements, related party transactions, income taxes, and equity structure - The financial statements are prepared under U.S. GAAP and consolidate the VIE (TRX ZJ) as the company is deemed its primary beneficiary[600](index=600&type=chunk)[611](index=611&type=chunk) - Revenue from insurance brokerage services is recognized at the point in time when an insurance policy becomes effective and the premium is collected[649](index=649&type=chunk) - As of October 31, 2023, the company had a **$7.8 million** note receivable with a third party, bearing a **2.0%** annual interest rate and maturing in October 2025[690](index=690&type=chunk) - In FY2023, three insurance carriers accounted for **32%**, **28%**, and **10%** of total revenue, indicating significant customer concentration[756](index=756&type=chunk)[757](index=757&type=chunk)

Core Points - TIAN RUIXIANG Holdings Ltd has regained compliance with Nasdaq's minimum bid price requirement, maintaining a closing bid price of $1.00 per share or greater for ten consecutive business days as of May 28, 2024 [1] - The company received an extension from Nasdaq until August 15, 2024, to comply with filing requirements after a deficiency notice due to a delay in filing its Annual Report on Form 20-F for the fiscal year ended October 31, 2023 [2] - The company is an insurance broker in China, distributing a variety of insurance products, including property and casualty insurance as well as life and health insurance [3]

BEIJING, May 08, 2024 (GLOBE NEWSWIRE) -- TIAN RUIXIANG Holdings Ltd (Nasdaq: TIRX) (the "Company"), a China-based insurance broker conducting business through its variable interest entity in China, today announced that the Company held an extraordinary general meeting of shareholders on Monday, May 6, 2024, at which the shareholders approved the proposal for a 1-for-5 reverse share split of the Company's ordinary shares (the "Share Consolidation"). No fractional shares will be issued in connection with the ...

BEIJING, Feb. 14, 2024 (GLOBE NEWSWIRE) -- TIAN RUIXIANG Holdings Ltd (NASDAQ:TIRX) (the "Company"), a China-based insurance broker conducting business through its variable interest entity in China, today announced that TRX HongKong Investment Limited ("TRX HongKong"), a wholly-owned subsidiary of the Company, has entered into a sale and purchase agreement (the "SPA") to acquire Peak Consulting Services Limited (the "Target") from Yuefu Company Limited (the "Vendor"), the sole shareholder of the Target. The ...

[Condensed Consolidated Financial Statements](index=1&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the company's financial position, operating results, equity changes, and cash flows for the interim periods, providing a comprehensive overview of its financial performance [Condensed Consolidated Balance Sheets](index=1&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of April 30, 2023, the company's total assets increased to **$37,002,816** from **$35,030,828** on October 31, 2022, driven by cash and restricted cash, while short-term investments were liquidated Condensed Consolidated Balance Sheets (USD) | Indicator | April 30, 2023 (USD) | October 31, 2022 (USD) | | :------------------------- | :------------------- | :--------------------- | | **Assets** | | | | Cash | 35,923,605 | 2,508 | | Restricted Cash | 732,602 | 692,734 | | Short-term Investments | — | 26,179,662 | | Accounts Receivable, Net | 114,489 | 51,202 | | Total Current Assets | 36,892,085 | 34,858,624 | | Total Non-current Assets | 110,731 | 172,204 | | **Total Assets** | **37,002,816** | **35,030,828** | | **Liabilities** | | | | Taxes Payable | 517,035 | 466,878 | | Payroll Payable | 643,043 | 424,987 | | Amounts Due to Related Parties | 810,725 | 126,530 | | Total Current Liabilities | 2,436,529 | 1,494,088 | | Total Non-current Liabilities | 16,540 | 54,718 | | **Total Liabilities** | **2,453,069** | **1,548,806** | | **Equity** | | | | Share Capital | 16,374 | 13,886 | | Additional Paid-in Capital | 43,728,524 | 42,663,012 | | Accumulated Deficit | (7,287,070) | (5,800,817) | | Accumulated Other Comprehensive Loss | (2,134,757) | (3,620,712) | | **Total Equity** | **34,549,747** | **33,482,022** | | **Total Liabilities and Equity** | **37,002,816** | **35,030,828** | [Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss](index=2&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For the six months ended April 30, 2023, revenue decreased to **$724,859**, while operating and net losses narrowed, and comprehensive loss significantly reduced due to foreign currency translation gains Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss (USD) | Indicator | Six Months Ended April 30, 2023 (USD) | Six Months Ended April 30, 2022 (USD) | | :--------------------------------------------- | :------------------------------------ | :------------------------------------ | | Revenue | 724,859 | 945,645 | | Selling and Marketing Expenses | 1,564,353 | 1,113,896 | | General and Administrative Expenses - Professional Services | 735,314 | 930,873 | | General and Administrative Expenses - Compensation and Related Benefits | 290,810 | 2,346,067 | | Total Operating Expenses | 2,652,845 | 4,826,069 | | Operating Loss | (1,927,986) | (3,880,424) | | Interest Income | 468,200 | 368,498 | | Net Loss | (1,486,253) | (3,503,727) | | Net Loss Attributable to TIAN RUIXIANG HOLDINGS LTD Common Stockholders | (1,486,253) | (3,503,707) | | Unrealized Foreign Currency Translation Gain (Loss) | 1,485,978 | (947,912) | | Comprehensive Loss | (275) | (4,451,639) | | Comprehensive Loss Attributable to TIAN RUIXIANG HOLDINGS LTD Common Stockholders | (298) | (4,451,605) | | Net Loss Per Share (Basic and Diluted) | (0.50) | (1.42) | | Weighted Average Common Shares Outstanding (Basic and Diluted) | 2,974,507 | 2,459,786 | [Unaudited Condensed Consolidated Statements of Changes in Equity](index=3&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity) For the six months ended April 30, 2023, total equity increased to **$34,549,747**, driven by common stock issuance for services and foreign currency translation adjustments Equity Changes for the Six Months Ended April 30, 2023 (USD) | Indicator | October 31, 2022 Balance (USD) | April 30, 2023 Balance (USD) | | :-------------------------------------- | :----------------------------- | :--------------------------- | | Class A Common Shares Outstanding | 2,527,200 | 3,024,745 | | Class A Common Share Amount | 12,636 | 15,124 | | Additional Paid-in Capital | 42,663,012 | 43,728,524 | | Accumulated Deficit | (5,800,817) | (7,287,070) | | Accumulated Other Comprehensive Loss | (3,620,712) | (2,134,757) | | Total Equity | 33,482,022 | 34,549,747 | **Key Changes:** * Issuance of **490,000** Class A common shares for services, valued at **$1,068,000**[92](index=92&type=chunk) * Foreign currency translation adjustment resulted in a gain of **$1,485,978**[92](index=92&type=chunk) Equity Changes for the Six Months Ended April 30, 2022 (USD) | Indicator | October 31, 2021 Balance (USD) | April 30, 2022 Balance (USD) | | :-------------------------------------- | :----------------------------- | :--------------------------- | | Class A Common Shares Outstanding | 2,020,000 | 2,447,200 | | Class A Common Share Amount | 10,100 | 12,236 | | Additional Paid-in Capital | 39,776,761 | 42,363,453 | | Accumulated Deficit | (1,090,060) | (4,593,767) | | Accumulated Other Comprehensive Income (Loss) | 96,709 | (851,189) | | Total Equity | 38,994,902 | 37,132,091 | **Key Changes:** * Issuance of **427,200** common shares for services, valued at **$2,588,828**[11](index=11&type=chunk) * Net loss of **$(3,503,727)**[11](index=11&type=chunk) * Foreign currency translation adjustment resulted in a loss of **$(947,912)**[11](index=11&type=chunk) [Unaudited Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended April 30, 2023, operating cash flow turned positive at **$761,583**, and investing cash flow significantly increased to **$35,115,075**, primarily from note and short-term investment recoveries Unaudited Condensed Consolidated Statements of Cash Flows (USD) | Indicator | Six Months Ended April 30, 2023 (USD) | Six Months Ended April 30, 2022 (USD) | | :--------------------------------------------- | :------------------------------------ | :------------------------------------ | | Net Loss | (1,486,253) | (3,503,727) | | Stock-based Compensation and Service Fees | 1,068,000 | 2,588,828 | | Net Cash Provided by Operating Activities | 761,583 | (75,608) | | Collection of Notes Receivable | 7,500,000 | — | | Proceeds from Sale of Short-term Investments | 27,615,075 | — | | Net Cash Provided by Investing Activities | 35,115,075 | (2,436) | | Net Cash Provided by Financing Activities | — | — | | Effect of Exchange Rate Changes on Cash, Cash Equivalents, and Restricted Cash | 84,307 | (955,185) | | Net Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash | 35,960,965 | (1,033,229) | | Cash, Cash Equivalents, and Restricted Cash at End of Period | 36,656,207 | 29,810,412 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=6&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures regarding the company's accounting policies, financial instruments, related party transactions, and other significant financial information [NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS](index=6&type=section&id=NOTE%201%20%E2%80%93%20ORGANIZATION%20AND%20NATURE%20OF%20OPERATIONS) TRX, a Cayman Islands holding company, provides insurance brokerage services in China through its Variable Interest Entity (VIE), TRX ZJ, consolidated via contractual arrangements - TRX is a Cayman Islands-registered holding company that provides insurance brokerage services in China through its VIE, Zhejiang Tianruixiang Insurance Broker Co., Ltd (TRX ZJ)[17](index=17&type=chunk) - The company consolidates TRX ZJ by obtaining control and becoming its primary beneficiary through a series of contractual agreements (VIE agreements) with TRX ZJ and its sole equity holder, in accordance with U.S. GAAP[18](index=18&type=chunk)[19](index=19&type=chunk) Company Structure Overview | Entity Name | Type | Ownership/Relationship | | :----------------- | :--------------------------------- | :--------------------- | | TRX HK | Hong Kong Company | 100% Owned by TRX | | TRX BJ | Wholly Foreign-Owned Enterprise in China | 100% Owned by TRX HK | | TRX ZJ | Limited Liability Company in China | VIE | | NDB Technology | Limited Liability Company in China | 100% Owned by TRX ZJ | | TYDW Technology | Limited Liability Company in China | 100% Owned by TRX ZJ | | Hengbang Insurance | Limited Liability Company in China | 99.8% Owned by TRX ZJ | [NOTE 2 – BASIS OF PRESENTATION](index=7&type=section&id=NOTE%202%20%E2%80%93%20BASIS%20OF%20PRESENTATION) These unaudited condensed consolidated financial statements are prepared under U.S. GAAP and SEC rules, covering the company, its subsidiaries, and VIEs, with intercompany transactions eliminated - These interim condensed consolidated financial statements are unaudited and prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (SEC) and U.S. GAAP[22](index=22&type=chunk)[23](index=23&type=chunk) - The statements include the accounts of the company, its wholly-owned subsidiaries, and its VIEs and their subsidiaries, with all intercompany accounts and transactions eliminated[23](index=23&type=chunk) - These condensed consolidated financial statements should be read in conjunction with the company's annual report on Form 20-F for the year ended October 31, 2022, filed with the SEC[24](index=24&type=chunk) [NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=7&type=section&id=NOTE%203%20%E2%80%93%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines the company's significant accounting policies, including fair value, cash, restricted cash, revenue recognition, and foreign currency translation, with no material changes as of April 30, 2023 - The company's significant accounting policies as of April 30, 2023, have not materially changed from those described in the 2022 annual report on Form 20-F, which would significantly impact the company's financial position and operating results[25](index=25&type=chunk) - The company applies ASC 820 for fair value measurements, categorizing inputs into three levels: Level 1 (quoted prices in active markets), Level 2 (observable inputs), and Level 3 (unobservable inputs) As of April 30, 2023, the company had no short-term investments; as of October 31, 2022, short-term investments totaled **$26,179,662** and were classified as Level 2[28](index=28&type=chunk)[31](index=31&type=chunk)[33](index=33&type=chunk) Cash Balances by Geographic Region (USD) | Country | April 30, 2023 (USD) | Percentage | October 31, 2022 (USD) | Percentage | | :------ | :------------------- | :--------- | :--------------------- | :--------- | | China | 28,123,605 | 78.3 % | 1,917 | 76.4 % | | Hong Kong | 7,800,000 | 21.7 % | 591 | 23.6 % | | **Total** | **35,923,605** | **100.0 %** | **2,508** | **100.0 %** | - Restricted cash primarily includes unremitted premiums collected as an insurance broker and 10% of registered capital required by the China Insurance Regulatory Commission (CIRC) As of April 30, 2023, and October 31, 2022, restricted cash amounted to **$732,602** and **$692,734**, respectively[37](index=37&type=chunk) - Revenue from insurance brokerage services is recognized when insurance policies become effective and premiums are collected, as collectability cannot be assured prior to that point Commission adjustments related to policy cancellations accounted for **0.6%** and **0.8%** of total commission revenue for the six months ended April 30, 2023, and 2022, respectively[53](index=53&type=chunk)[54](index=54&type=chunk) - The company implemented a one-for-five reverse stock split on November 16, 2022, with all share and per-share information retroactively adjusted to reflect this split[70](index=70&type=chunk) [Fair Value of Financial Instruments and Fair Value Measurements](index=7&type=section&id=Fair%20Value%20of%20Financial%20Instruments%20and%20Fair%20Value%20Measurements) The company applies ASC 820 for fair value measurements, categorizing inputs into three levels, with no short-term investments as of April 30, 2023 - The company applies ASC 820 guidance for fair value measurements, classifying inputs into three levels: Level 1 (quoted prices in active markets), Level 2 (observable inputs), and Level 3 (unobservable inputs)[28](index=28&type=chunk)[31](index=31&type=chunk) - As of April 30, 2023, the company had no short-term investments As of October 31, 2022, short-term investments totaled **$26,179,662** and were classified as Level 2[32](index=32&type=chunk)[33](index=33&type=chunk) [Cash and Cash Equivalents](index=9&type=section&id=Cash%20and%20Cash%20Equivalents) Cash balances are primarily held in China and Hong Kong, with **$35,923,605** as of April 30, 2023, and no cash equivalents reported Cash Balances by Geographic Region (USD) | Country | April 30, 2023 (USD) | Percentage | October 31, 2022 (USD) | Percentage | | :------ | :------------------- | :--------- | :--------------------- | :--------- | | China | 28,123,605 | 78.3 % | 1,917 | 76.4 % | | Hong Kong | 7,800,000 | 21.7 % | 591 | 23.6 % | | **Total** | **35,923,605** | **100.0 %** | **2,508** | **100.0 %** | - As of April 30, 2023, and October 31, 2022, the company had no cash equivalents[36](index=36&type=chunk) [Restricted Cash](index=9&type=section&id=Restricted%20Cash) Restricted cash includes unremitted premiums and 10% of registered capital mandated by CIRC, totaling **$732,602** as of April 30, 2023 - Restricted cash includes unremitted premiums collected as an insurance broker and 10% of registered capital required by the China Insurance Regulatory Commission (CIRC)[37](index=37&type=chunk) Restricted Cash Balances (USD) | Date | Amount (USD) | | :--------------- | :----------- | | April 30, 2023 | 732,602 | | October 31, 2022 | 692,734 | [Concentration of Credit Risk and Uncertainties](index=9&type=section&id=Concentration%20of%20Credit%20Risk%20and%20Uncertainties) The company faces significant uninsured cash balances in Chinese state-owned banks and operational risks tied to China's political, economic, and legal environment - Cash balances held in state-owned banks in China exceeding RMB 500,000 (approximately **$72,000**) per bank are not covered by insurance As of April 30, 2023, approximately **$28,675,000** of cash balances in China were uninsured[41](index=41&type=chunk) - The company's operations are primarily conducted in China, and its business, financial condition, and operating results may be affected by changes in China's political, economic, and legal environment[42](index=42&type=chunk) [Revenue Recognition](index=11&type=section&id=Revenue%20Recognition) Revenue from insurance brokerage services is recognized when policies are effective and premiums collected, adhering to ASC Topic 606, with minimal impact from cancellations - The company recognizes revenue in accordance with ASC Topic 606, "Revenue from Contracts with Customers," with the core principle being to recognize revenue in an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring promised goods or services to customers[49](index=49&type=chunk) - Revenue from insurance brokerage services is recognized when insurance policies become effective and premiums are collected, as collectability cannot be assured prior to that point[53](index=53&type=chunk) - Commission adjustments related to policy cancellations accounted for **0.6%** and **0.8%** of total commission revenue for the six months ended April 30, 2023, and 2022, respectively, indicating a negligible impact[54](index=54&type=chunk) [Foreign Currency Translation and Transaction](index=13&type=section&id=Foreign%20Currency%20Translation%20and%20Transaction) The company's reporting currency is USD, while its Chinese subsidiaries and VIEs use RMB as their functional currency, with specific exchange rates applied - The company's reporting currency is the U.S. dollar The functional currency of the parent company, TRX, and TRX HK is the U.S. dollar, while the functional currency of TRX BJ, TRX ZJ, and its subsidiaries is the Renminbi (RMB)[59](index=59&type=chunk) Exchange Rate Information | Date/Period | Exchange Rate (RMB to 1 USD) | | :---------------------------------------- | :--------------------------- | | April 30, 2023 (Balance Sheet) | 6.9122 | | October 31, 2022 (Balance Sheet) | 7.3029 | | Six Months Ended April 30, 2023 (Operations/Cash Flow) | 6.9233 | | Six Months Ended April 30, 2022 (Operations/Cash Flow) | 6.3721 | [Per Share Data](index=13&type=section&id=Per%20Share%20Data) Basic net loss per share is calculated by dividing net loss by weighted average common shares, with 709,000 anti-dilutive warrants outstanding - Basic net loss per share is calculated by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during the period Diluted net loss per share reflects the potential dilution that could occur[63](index=63&type=chunk)[64](index=64&type=chunk) Anti-Dilutive Securities (Stock Warrants) | Indicator | Six Months Ended April 30, 2023 | Six Months Ended April 30, 2022 | | :-------------------- | :------------------------------ | :------------------------------ | | Stock Warrants | 709,000 | 709,000 | | Total Potentially Dilutive Securities | 709,000 | 709,000 | [Reverse Stock Split](index=14&type=section&id=Reverse%20Stock%20Split) The company executed a one-for-five reverse stock split on November 16, 2022, with all share and per-share data retroactively adjusted - The company implemented a one-for-five reverse stock split on November 16, 2022 All share and per-share information has been retroactively adjusted to reflect this split[70](index=70&type=chunk) [NOTE 4 – OTHER CURRENT AND NON-CURRENT ASSETS](index=15&type=section&id=NOTE%204%20%E2%80%93OTHER%20CURRENT%20AND%20NON-CURRENT%20ASSETS) As of April 30, 2023, other current and non-current assets totaled **$142,602**, a decrease from **$189,035**, primarily comprising prepaid professional services, recoverable VAT, and deposits Other Current and Non-Current Assets Composition (USD) | Item | April 30, 2023 (USD) | October 31, 2022 (USD) | | :----------------------- | :------------------- | :--------------------- | | Prepaid Professional Service Fees | 54,004 | 108,345 | | Recoverable VAT | 41,377 | 33,553 | | Deposits | 21,213 | 24,251 | | Other | 26,008 | 22,886 | | **Total** | **142,602** | **189,035** | | Current Portion | 121,389 | 168,957 | | Non-current Portion | 21,213 | 20,078 | - Prepaid professional service fees primarily relate to advance payments for consulting and advisory services, which are recognized as expenses over the period the services are rendered[75](index=75&type=chunk) [NOTE 5 – NOTE RECEIVABLE](index=15&type=section&id=NOTE%205%20%E2%80%93%20NOTE%20RECEIVABLE) A **$7.5 million** note receivable issued on January 29, 2021, was fully collected upon maturity on January 29, 2023, resulting in zero principal and accrued interest balances as of April 30, 2023 - The company issued a **$7.5 million** note receivable to a third party on January 29, 2021, bearing an annual interest rate of **2.0%**, which matured and was collected on January 29, 2023[76](index=76&type=chunk) Note Receivable and Accrued Interest Balances (USD) | Item | April 30, 2023 (USD) | October 31, 2022 (USD) | | :----------------------- | :------------------- | :--------------------- | | Note Receivable Principal Balance | 0 | 7,500,000 | | Accrued Interest Balance | 0 | 262,192 | Note Receivable Interest Income (USD) | Period | Amount (USD) | | :------------------------------------ | :----------- | | Six Months Ended April 30, 2023 | 37,808 | | Six Months Ended April 30, 2022 | 73,973 | [NOTE 6 – TAXES PAYABLE](index=15&type=section&id=NOTE%206%20%E2%80%93%20TAXES%20PAYABLE) As of April 30, 2023, total taxes payable increased to **$517,035** from **$466,878**, primarily driven by income taxes payable Taxes Payable Composition (USD) | Item | April 30, 2023 (USD) | October 31, 2022 (USD) | | :------------- | :------------------- | :--------------------- | | Income Tax Payable | 515,494 | 465,291 | | VAT Payable | — | 458 | | Other | 1,541 | 1,129 | | **Total** | **517,035** | **466,878** | [NOTE 7 – ACCRUED LIABILITIES AND OTHER PAYABLES](index=15&type=section&id=NOTE%207%20%E2%80%93%20ACCRUED%20LIABILITIES%20AND%20OTHER%20PAYABLES) As of April 30, 2023, accrued liabilities and other payables totaled **$382,895**, remaining stable compared to **$384,893** on October 31, 2022, primarily due to accrued professional service fees Accrued Liabilities and Other Payables Composition (USD) | Item | April 30, 2023 (USD) | October 31, 2022 (USD) | | :----------------------- | :------------------- | :--------------------- | | Accrued Professional Service Fees | 311,417 | 310,476 | | Other | 71,478 | 74,417 | | **Total** | **382,895** | **384,893** | [NOTE 8 – RELATED PARTY TRANSACTIONS](index=16&type=section&id=NOTE%208%20%E2%80%93%20RELATED%20PARTY%20TRANSACTIONS) For the six months ended April 30, 2023, no related party leases or borrowings occurred, but payables to related parties significantly increased to **$810,725** for expenses advanced on the company's behalf - For the six months ended April 30, 2023, the company did not lease office space from related parties[83](index=83&type=chunk) - For the six months ended April 30, 2023, there were no related party borrowings[84](index=84&type=chunk) Amounts Due to Related Parties (USD) | Related Party Name | April 30, 2023 (USD) | October 31, 2022 (USD) | | :----------------------- | :------------------- | :--------------------- | | Baohai Xu | 232,582 | 105,500 | | Feng'e Feng | 186,571 | — | | Mingxiu Luan | 125,027 | — | | Sheng Xu | 105,500 | — | | Mufang Gao | 79,870 | — | | Zhe Wang | 68,958 | — | | WDZG Consulting | 9,983 | 9,449 | | Liwei Song | 1,855 | — | | Fan Shen | 329 | 578 | | Kui Che | 50 | 48 | | Xiangchun Ruan | — | 10,955 | | **Total** | **810,725** | **126,530** | - Amounts due to related parties represent expenses paid by related parties on behalf of the company, which are short-term, non-interest bearing, and repayable on demand[90](index=90&type=chunk) [NOTE 9 – EQUITY](index=17&type=section&id=NOTE%209%20%E2%80%93%20EQUITY) Equity comprises Class A and B common shares, with Class B having 18x voting rights and convertibility to Class A; **$1,068,000** in stock-based compensation was recognized for 490,000 Class A shares issued for services - The company's share capital consists of Class A and Class B common shares Class B common shareholders possess **18** votes on all matters and are convertible into Class A common shares at the holder's option at any time, while Class A common shares are not convertible into Class B common shares[91](index=91&type=chunk) - For the six months ended April 30, 2023, the company issued **490,000** Class A common shares for services, valued at **$1,068,000**, and recognized corresponding stock-based compensation expenses[92](index=92&type=chunk) Warrant Activity and Details | Indicator | October 31, 2022 | April 30, 2023 | | :-------------------------------------- | :--------------- | :------------- | | Number of Warrants (End of Period) | 709,000 | 709,000 | | Weighted Average Exercise Price (End of Period, USD) | 38.86 | 38.86 | | Number of Exercisable Warrants (End of Period) | 709,000 | 709,000 | | Intrinsic Value of Warrants (End of Period) | None | None | | Remaining Contractual Term (Years) | - | 2.94 | - As of April 30, 2023, and October 31, 2022, a total of **$226,253** of the net assets of the company's Chinese subsidiaries, VIEs, and their subsidiaries were restricted from transfer to the company under Chinese laws and regulations[102](index=102&type=chunk) [NOTE 10 – COMMITMENTS AND CONTINGENCIES](index=19&type=section&id=NOTE%2010%20%E2%80%93%20COMMITMENTS%20AND%20CONTINGENCIES) The company faces potential legal actions and regulatory uncertainties regarding its VIE structure, while operating lease expenses for the six months ended April 30, 2023, were **$49,000** - The company may be subject to legal proceedings and claims in the ordinary course of business, but management believes these actions will not, in the aggregate, have a material adverse effect on the company's financial position, results of operations, or liquidity[105](index=105&type=chunk) Operating Lease Expenses (USD) | Period | Amount (USD) | | :------------------------------------ | :----------- | | Six Months Ended April 30, 2023 | 49,000 | | Six Months Ended April 30, 2022 | 212,000 | Operating Lease Liability Maturities as of April 30, 2023 (USD) | Period | Amount (USD) | | :----------------------------------- | :----------- | | Twelve Months Ending April 30, 2024 | 85,578 | | Twelve Months Ending April 30, 2025 | 16,618 | | Thereafter | — | | Total Lease Payments | 102,196 | | Amount Representing Interest on Lease Payments | (2,825) | | Total Present Value of Operating Lease Liabilities | 99,371 | | Current Portion | 82,831 | | Long-term Portion | 16,540 | - Management believes the company's VIE structure complies with existing Chinese laws and regulations, and the VIE agreements are valid and binding However, there are significant uncertainties regarding the interpretation and application of Chinese laws and regulations, and the company cannot guarantee that regulatory agencies will not take a contrary view[111](index=111&type=chunk)[112](index=112&type=chunk) [NOTE 11 – CONCENTRATIONS](index=20&type=section&id=NOTE%2011%20%E2%80%93%20CONCENTRATIONS) The company faces significant concentration risks in uninsured cash balances in Chinese state-owned banks and high dependency on a few insurance companies for revenue and accounts receivable - As of April 30, 2023, the company's cash, cash equivalents, and restricted cash balances in state-owned banks in China totaled **$28,856,207**, of which **$28,675,232** were uninsured, posing a concentration of credit risk[113](index=113&type=chunk) Revenue Concentration (10% or More of Total Revenue) | Insurance Company | Six Months Ended April 30, 2023 | Six Months Ended April 30, 2022 | | :---------------- | :------------------------------ | :------------------------------ | | A | 36 % | < 10% | | B | 24 % | < 10% | | C | < 10% | 14 % | | D | 12 % | 11 % | | E | < 10% | 11 % | - As of April 30, 2023, four insurance companies accounted for **86.1%** of the company's total outstanding accounts receivable As of October 31, 2022, two insurance companies accounted for **77.5%** of the company's total outstanding accounts receivable[115](index=115&type=chunk)[116](index=116&type=chunk) - For the six months ended April 30, 2023, and 2022, no single supplier accounted for **10%** or more of the company's total purchases[117](index=117&type=chunk) [NOTE 12 – SUBSEQUENT EVENTS](index=21&type=section&id=NOTE%2012%20%E2%80%93%20SUBSEQUENT%20EVENTS) Management has evaluated subsequent events up to the report submission date and found no material events requiring adjustment or disclosure in the financial statements - Management has evaluated subsequent events up to the date of this report's submission and has not identified any events that would require adjustment to or disclosure in the financial statements[119](index=119&type=chunk)

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 20-F ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended October 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to _____________. OR ☐ SHELL COMPANY REPORT PUR ...