Financial Performance - Revenues for the three months ended October 31, 2024, were $125,000, a decrease from $31 in the same period of 2023[23]. - Total operating expenses decreased to $521,109 for the three months ended October 31, 2024, down from $781,779 in the same period of 2023, reflecting a reduction of approximately 33.3%[23]. - Net loss for the three months ended October 31, 2024, was $367,074, compared to a net loss of $625,463 for the same period in 2023, indicating an improvement of approximately 41.3%[23]. - The company reported a loss per share of $0.03 for the three months ended October 31, 2024, compared to a loss per share of $0.06 for the same period in 2023[23]. - For the three months ended October 31, 2024, the Company reported a net loss of approximately $0.4 million, compared to a net loss of $0.6 million for the same period in 2023, indicating a 33.33% improvement in net loss year-over-year[32]. - Total revenue from consulting services decreased to $nil for the three months ended October 31, 2024, down from approximately $0.1 million for the same period in 2023, representing a 100% decrease[112][120]. Assets and Liabilities - Total current assets increased to $5,785,278 as of October 31, 2024, compared to $2,898,748 as of July 31, 2024, representing a growth of approximately 99.5%[21]. - Cash and cash equivalents decreased to $457,764 as of October 31, 2024, from $1,249,376 as of July 31, 2024, a decline of approximately 63.3%[21]. - Total liabilities decreased to $886,838 as of October 31, 2024, from $1,258,834 as of July 31, 2024, representing a reduction of approximately 29.5%[21]. - Shareholders' equity increased to $4,997,680 as of October 31, 2024, compared to $1,753,754 as of July 31, 2024, reflecting a growth of approximately 185.5%[21]. - As of October 31, 2024, the Company had cash of approximately $0.5 million and short-term investments in trading securities of approximately $4.2 million, which could cover current liabilities of approximately $0.6 million[33]. Cash Flow - Operating cash outflows for the three months ended October 31, 2024, were approximately $0.8 million, while the previous year had operating cash inflows of approximately $0.2 million, reflecting a significant change in cash flow dynamics[32]. - Cash at the end of the period on October 31, 2024, was approximately $0.5 million, with current liabilities of approximately $0.6 million[130]. Investments and Securities - The Company recognized a gain of $148,158 and a loss of $109,404 from investments in trading securities for the three months ended October 31, 2024, and 2023, respectively[42]. - Loss from investment in trading securities was approximately $0.1 million for the three months ended October 31, 2023, compared to a gain of approximately $0.1 million for the same period in 2024[124]. Operational Changes and Future Plans - The Company plans to transition its consulting services from PRC-based customers to more international customers to mitigate revenue concentration risks[66]. - The Company has shifted its geographic focus from China to North America, emphasizing assistance to mid and small companies in becoming public on U.S. capital markets[110]. - The Company plans to expand operations to other Asian countries, including Malaysia, Vietnam, and Singapore, while maintaining a focus on the North American market[110]. Legal and Compliance Issues - The company is currently involved in a lawsuit filed by J.P. Morgan Securities LLC, claiming $5,064,160 in damages related to a stock transaction[157]. - The company is evaluating claims and defenses related to the lawsuit with J.P. Morgan Securities LLC, and mediation efforts have been attempted[158]. - A settlement agreement was reached with Boustead, requiring the company to pay a total of $1,000,000 in three installments, with the first installment of $250,000 due upon execution of the agreement[156]. - The court has granted Boustead leave to amend its complaint, focusing solely on breach of contract claims[152]. - The company filed a motion to compel arbitration in response to Boustead's claims, which has been granted by the court[153]. Management and Internal Controls - The Company’s ability to continue as a going concern is dependent on management's ability to successfully execute its business plan, which includes increasing revenue while controlling operating costs[33]. - The Company has a history of net losses from operations and cash outflows from operating activities, raising substantial doubt about its ability to continue as a going concern[32]. - The financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business[34]. - As of October 31, 2024, the company's disclosure controls and procedures were deemed ineffective due to insufficient full-time accounting and financial reporting personnel[143]. - The company is in the process of hiring qualified accounting personnel and implementing training programs to strengthen financial reporting functions[143]. - The company has established a plan to implement regular U.S. GAAP accounting training for its personnel to address compliance issues[143]. - The company is working on establishing an internal audit function and standardizing financial reporting processes[143].
ATIF (ATIF) - 2025 Q1 - Quarterly Report