FOFO 6-K
Hang Feng Technology Innovation Co., Ltd. (FOFO)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of September
Commission File Number:
Unit 2806, 28/F, Tower One, Lippo Centre
No. 89 Queensway, Hong Kong
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:
Form 20-F ☒ Form 40-F ☐
EXPLANATORY NOTE
Hang Feng Technology Innovation Co., Ltd. is furnishing its unaudited condensed consolidated financial statements and notes, as well as the Management’s Discussion and Analysis of Financial Condition and Results of Operations for the six months ended June 30, 2026 and 2025. The unaudited condensed consolidated financial statements and notes, and the Management’s Discussion and Analysis of Financial Condition and Results of Operations are attached as Exhibit 99.1 and 99.2 to this report of foreign private issuer on Form 6-K.
Financial Statements and Exhibits.
Exhibits.
| Exhibit No. | Description | |
| 99.1 | Unaudited Condensed Consolidated Financial Statements and Notes of Hang Feng Technology Innovation Co., Ltd. for the Six Months Ended June 30, 2026 and 2025 | |
| 99.2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |
| 101. INS | Inline XBRL Instance Document. | |
| 101. SCH | Inline XBRL Taxonomy Extension Schema Document. | |
| 101. CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |
| 101. DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |
| 101. LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | |
| 101. PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Hang Feng Technology Innovation Co., Ltd. | ||
| Date: September 4, 2026 | By: | /s/ XU Zhiheng |
| Name: | XU Zhiheng | |
| Title: | Chief Executive Officer | |
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Exhibit 99.1
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
| As of June 30, 2026 |
As of December 31, 2025 |
|||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current Assets | ||||||||
| Cash | $ | $ | ||||||
| Accounts receivable | ||||||||
| Accounts receivable – a related party | ||||||||
| Other receivables and prepaid expenses | ||||||||
| Total current assets | ||||||||
| Property and equipment, net | ||||||||
| Intangible assets, net | ||||||||
| Right-of-use assets | ||||||||
| Equity Investment | ||||||||
| Deferred tax assets | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and shareholders’ equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | $ | ||||||
| Deferred revenue | ||||||||
| Other payables and accrued liabilities | ||||||||
| Lease liabilities – current | ||||||||
| Taxes payable | ||||||||
| Total current liabilities | ||||||||
| Non-current liabilities | ||||||||
| Lease liabilities – non-current | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies (Note 15) | ||||||||
| Shareholders’ equity | ||||||||
| Class A ordinary shares, $ | ||||||||
| Class B ordinary shares, $ | ||||||||
| Additional paid-in capital | ||||||||
| Additional paid-in capital – Restricted Share Unit | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Accumulated other comprehensive (loss) income | ( | ) | ||||||
| Total shareholders’ equity | ||||||||
| Total liabilities and shareholders’ equity | $ | $ | ||||||
| ** |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
| For the Six Months Ended June 30, |
||||||||
| 2026 | 2025 | |||||||
| Revenue: | ||||||||
| Management consulting services | $ | $ | ||||||
| Management consulting services-related parties | ||||||||
| Fund management revenue | ||||||||
| Total revenues | ||||||||
| Operating expenses: | ||||||||
| Staff costs and employee benefits | ( | ) | ( | ) | ||||
| Rental and office expenses (inclusive of and $ | ( | ) | ( | ) | ||||
| Professional fees | ( | ) | ( | ) | ||||
| Depreciation | ( | ) | ( | ) | ||||
| Research and development | ( | ) | ||||||
| Other administrative expenses | ( | ) | ( | ) | ||||
| Total operating expenses | ( | ) | ( | ) | ||||
| (Loss) income from operations | ( | ) | ||||||
| Other income (expense) | ||||||||
| Interest income | ||||||||
| Loan interest income | ||||||||
| Other income (expenses) | ( | ) | ||||||
| Total other income (expenses), net | ( | ) | ||||||
| (Loss) income before income taxes | ( | ) | ||||||
| Income tax benefit (expenses) | ( | ) | ||||||
| Net (loss) income | ( | ) | ||||||
| Other comprehensive (loss) income | ||||||||
| Foreign currency translation adjustment | ( | ) | ( | ) | ||||
| Comprehensive (loss) income | $ | ( | ) | $ | ||||
| Weighted average number of ordinary shares outstanding | ||||||||
| Basic and diluted – Class A and Class B ordinary shares* | ||||||||
| (Loss) earnings per share | ||||||||
| Basic and diluted – Class A and Class B ordinary shares* | $ | ( | ) | $ | ||||
| * |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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HANG FENG TECHNOLOGY INNOVATION CO., LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
(Unaudited)
| Class A Ordinary shares |
Class B Ordinary shares |
Additional paid-in |
Additional paid-in capital | Accumulated | Accumulated other comprehensive |
|||||||||||||||||||||||||||||||
| Shares* | Amount* | Shares* | Amount* | capital | RSU | Deficit | (loss) income | Total | ||||||||||||||||||||||||||||
| Balance as of December 31, 2025 | $ | $ | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||||||||||||
| Issuance of ordinary shares | — | |||||||||||||||||||||||||||||||||||
| Reversal of granted but unvested RSUs | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Net loss | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Foreign currency translation | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Balance as of June 30, 2026 (Unaudited) | $ | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | |||||||||||||||||||||||||
| Class A Ordinary shares |
Class B Ordinary shares |
Additional paid-in |
Additional paid-in capital | Accumulated | Accumulated other comprehensive |
|||||||||||||||||||||||||||||||
| Shares* | Amount* | Shares | Amount | capital | RSU | Deficit | (loss) income | Total | ||||||||||||||||||||||||||||
| Balance as of December 31, 2024 | $ | $ | $ | ( | ) | $ | $ | |||||||||||||||||||||||||||||
| Net income | — | |||||||||||||||||||||||||||||||||||
| Foreign currency translation | — | — | ( | ) | ( | ) | ||||||||||||||||||||||||||||||
| Balance as of June 30, 2025 (Unaudited) | $ | $ | $ | $ | ( | ) | $ | ( | ) | $ | ||||||||||||||||||||||||||
| * | The share information is presented on a retrospective basis to reflect the stock split, share reclassification and shares increase (Note 1). |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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HANG FENG TECHNOLOGY INNOVATION CO., LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| For the Six Months Ended June 30, |
||||||||
| 2026 | 2025 | |||||||
| Cash flows from operating activities: | ||||||||
| Net (loss) income | $ | ( | ) | $ | ||||
| Adjustments to reconcile net (loss) income to net cash used in operating activities: | ||||||||
| Depreciation | ||||||||
| Amortization of ROU | ||||||||
| Issuance of ordinary shares recognized as R&D expenses | ||||||||
| Reversal of RSU Shares-based compensation | ( | ) | ||||||
| Change in operating assets and liabilities: | ||||||||
| Increase in accounts receivable | ( | ) | ( | ) | ||||
| Decrease in accounts receivable – a related party | ||||||||
| (Increase) decrease in other receivables and prepaid expenses | ( | ) | ||||||
| (Increase) decrease in deferred tax assets | ( | ) | ||||||
| Decrease in accounts payable | ( | ) | ( | ) | ||||
| Increase (decrease) in other payables and accrued liabilities | ( | ) | ||||||
| Decrease in deferred revenue | ( | ) | ( | ) | ||||
| (Decrease) increase in taxes payable | ||||||||
| Decrease in lease liabilities | ( | ) | ||||||
| Net cash used in operating activities | ( | ) | ( | ) | ||||
| Cash flows from investing activities: | ||||||||
| Loan to third party | ( | ) | ||||||
| Repayment from third party | ||||||||
| Net cash provided by investing activities | ||||||||
| Cash flows from financing activities: | ||||||||
| Proceeds from issuance of ordinary shares | ||||||||
| Repayment of loans to related party | ( | ) | ||||||
| Payment of deferred offering costs | ( | ) | ||||||
| Net cash provided by financing activities | ||||||||
| Effect of exchange of rate on cash | ( | ) | ( | ) | ||||
| (Decrease) increase in cash | ( | ) | ||||||
| Cash, beginning of period | ||||||||
| Cash, end of period | $ | $ | ||||||
| Supplemental disclosures of cash flow information | ||||||||
| Cash paid for income tax expense | $ | $ | ||||||
| Cash paid for interest expense | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 — Nature of business and organization
Hang Feng Technology Innovation Co., Ltd. (“Hang Feng”) is a holding company incorporated on October 15, 2024, under the laws of the Cayman Islands. Hang Feng and all its subsidiaries are hereafter referred to as the “Company”. The diagram below illustrates the Company’s corporate structure:
Hang Feng has no substantial operations other than holding all of the outstanding share capital of Starchain Investment Trading Limited (“Starchain”), Hang Feng Capital Management Limited (“HF CM”), Shine Prosperity Holding Limited (“Shine Prosperity”) and Hang Feng Fund SPC (“HF Fund SPC”). Shine Prosperity is also a holding company holding all of the outstanding share capital of Hang Feng International Asset Management Limited (“HF IAM”).
HF CM was incorporated on November 30, 2023 and on July 25, 2024, Lifong Lee transferred
Hang Feng acquired
On July 25, 2024, HF Fund SPC was incorporated under the laws of Cayman Islands as an exempt company with limited liability and as a wholly owned subsidiary of HF Holdings. On October 29, 2024, Hang Feng acquired
Hang Feng Offshore Holdings Limited, a BVI company and a wholly owned subsidiary of Hang Feng, was incorporated on November 13, 2025, with a wholly owned BVI entity, Hang Feng Horizon SPC, incorporated on January 2, 2026.
HF Helios AI PTE Limited, a Singaporean company and a wholly owned subsidiary of Hang Feng, was incorporated on
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HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 — Nature of business and organization (cont.)
Starchain was controlled by its director and shareholder, YEUNG, Sing Yuet Sherry, who is the wife of Mr. Fenglei Qian, the major shareholder of HF Holdings, from its incorporation until October 2024. On November 1, 2024, YEUNG Sing Yuet Sherry transferred her
The Company, through its subsidiaries, provides management consulting services, asset and fund management services in Hong Kong.
| Name | Background | Ownership | ||
| Starchain Investment Trading Limited (“Starchain”) | ● Incorporated on June 12, 2017 ● Management Consulting Services | |||
| Shine Prosperity Holding Limited (“Shine Prosperity”) | ● Incorporated on November 13, 2020 | |||
| Hang Feng International Asset Management Limited (“HF IAM”) | ● Incorporated on April 1, 2019 ● Asset Management | |||
| Hang Feng Capital Management Limited (“HF CM”) | ● Incorporated on November 30, 2023 ● Fund Management | |||
| Hang Feng Fund SPC (“HF Fund SPC”) | ● Incorporated on July 25, 2024 | |||
| Hang Feng Offshore Holdings Limited | ● Incorporated on November 13, 2025 | |||
| Hang Feng Horizon SPC | ● Incorporated on January 2, 2026 | |||
| HF Helios AI PTE Limited | ● Incorporated on May 28, 2026 |
The Company believed that it was appropriate to reflect the reorganization on a retroactive basis as if such structure had existed at the beginning of the first period presented in the accompanying unaudited condensed consolidated financial statements and in accordance with Accounting Standards Codification (“ASC”) 805-50-45-5, the entities under common control are presented on a combined basis for all periods to which such entities were under common control. The Company has retroactively adjusted all share and per share data for all periods presented. The unaudited condensed consolidated financial statements are prepared on the basis as if the reorganization became effective as of the beginning of the first year presented in the consolidated financial statements.
The Company effected a stock split at a ratio of
On June 12, 2026, the Company held an extraordinary meeting of shareholders (the “EGM”), at which its shareholders approved the redesignation and reclassification, increase, and reduction of its authorised share capital. The share redesignation and reclassification, and the increase in authorized share capital became effective upon shareholder approval of such proposals on June 12, 2026, while the reduction of share capital will be deemed effective as of the initial submission date of the relevant documents to the Cayman Registry, being June 22, 2026, subject to the approval by the Cayman Registry. As of the date of this filing, the documents submitted by the Company are still pending approval by the Cayman Registry. As a result, the authorized share capital has been reclassified into Class A ordinary shares and Class B ordinary shares, consisting of
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HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies
Basis of presentation
The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) pursuant to the rules and regulations of the Securities Exchange Commission (“SEC”). The interim results of operations are not necessarily indicative of results to be expected for any other interim period or for a full year. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, considered necessary for a fair presentation of its financial position and operating results have been included. These financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the related notes thereto for the years ended December 31, 2025 and 2024.
Principles of consolidation
The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using consistent accounting policies. All significant inter-company transactions and balances between members of the Company are eliminated in consolidation.
Foreign currency translation
The Company and its wholly-owned subsidiaries use US$ as their reporting currency. The functional currency of the Company’s subsidiaries in British Virgin Islands is US$ and the Company’s subsidiaries in Hong Kong is Hong Kong dollar (“HK$”), which are their respective local currencies based on the criteria of ASC 830, “Foreign Currency Matters”.
In the unaudited condensed consolidated financial statements of the Company, transactions in currencies other than the functional currency are measured and recorded in the functional currency using the exchange rate in effect at the date of the transaction. At the balance sheet date, monetary assets and liabilities that are denominated in currencies other than the functional currency are translated into the functional currency using the exchange rate at the balance sheet date. All gains and losses arising from foreign currency transactions are recorded in the statements of operations during the year in which they occur.
Translation of foreign currencies
The functional currency is US$ for the Company’s British Virgin Islands operations and HK$ for all other entities’ operations. The Company’s reporting currency is the US$. Assets and liabilities denominated in foreign currencies are translated at period-end exchange rates, statements of operations accounts are translated at average rates of exchange for the period and equity is translated at historical exchange rates. Any translation gains or losses are recorded in other comprehensive income (loss).
| For the Six Months Ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Average rate | ||||||||
| As of June 30, 2026 | As of December 31, 2025 | |||||||
| Period-end spot rate | ||||||||
7
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies (cont.)
Use of estimates and assumptions
The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in the Company’s unaudited condensed consolidated financial statements include revenue recognition, the useful lives of property and equipment and intangible assets and impairment of long-lived assets. Actual results could differ from these estimates.
Fair value measurement
The accounting standards regarding fair value of financial instruments and related fair value measurements define financial instruments and require disclosure of the fair value of financial instruments held by the Company.
The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurements and enhance disclosure requirements for fair value measures. The three levels are defined as follow:
| ● | Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. |
| ● | Level 2 inputs to the valuation methodology include quoted prices, other than those included in Level 1 for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. |
| ● | Level 3 inputs to the valuation methodology are unobservable and significant to the fair value. |
The carrying amounts included in current assets and current liabilities in the consolidated balance sheets approximate their fair values because of the short-term nature of such instruments. The Company values its short term investment using quoted prices in active markets, and accordingly the Company classifies the valuation techniques that use these inputs as Level 1.
Cash
Cash represents cash in bank accounts. The Company maintains bank accounts in Hong Kong. Management believes that the Company is not exposed to any significant credit risk on cash. The Company considers all short-term investments with an original maturity of months or less when purchased to be cash equivalents. As of June 30, 2026 and December 31, 2025, the Company did not have any cash equivalents.
Accounts receivable
The Company adopted Accounting Standards Codification “Financial Instruments — Credit Losses” (“ASC 326”) on January 1, 2023. Accounts receivables are presented net of an allowance for doubtful accounts. The Company maintains an allowance for credit losses in accordance with ASC 326 and records the allowance for credit losses as an offset to assets such as accounts receivable, and the estimated credit losses charged to the allowance is classified as “Asset impairment loss” in statements of operations and comprehensive income. The Company assesses collected ability by reviewing receivables on a collective basis where similar characteristics exist, primarily based on size, nature and on an individual basis when identify specific customers with known disputes or collected ability issues.
In determining the amount of the allowance for credit losses, the Company considers historical collectability based on past due status, the age of the receivable balances, credit quality of the Company’s customer based on ongoing credit evaluations, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company’s ability to collect from customers. Bad debts are written off as incurred. allowance was required as of June 30, 2026 and December 31, 2025. The accounts receivable balance of US$
8
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies (cont.)
Other receivables and prepaid expenses
Other receivables and prepaid expenses include rental deposits for rents and advance payments made to vendors for certain services. An allowance for doubtful accounts may be established and recorded based on management’s assessment of the likelihood of collection. Management reviews these items on a regular basis to determine if the allowance for doubtful accounts is adequate, and adjusts the allowance when necessary. Delinquent account balances are written-off against the allowance for doubtful accounts after management has determined that the likelihood of collection is not probable. No allowance was required as of June 30, 2026 and December 31, 2025.
Leases
The Company accounts for leases in accordance with ASC Topic 842, “Leases”(“ASC 842”). The Company determines if an arrangement is a lease at inception. All the Company’s leases are operating leases. Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date.
Any lease with a term of 12 months or less is considered short-term. As permitted by ASC 842, short-term leases are excluded from the ROU asset and lease liabilities on the consolidated balance sheets. Significant judgment may be required when determining whether a contract contains a lease, the length of the lease term, the allocation of the consideration in a contract between lease and non-lease components, and the determination of the discount rate included in the lease. The Company reviewed the underlying objective of each contract, the terms of the contract, and consider current and future business conditions when making these judgments.
The Company elected not to record assets and liabilities on its consolidated balance sheets for any new or existing lease arrangements with lease terms of
The initial lease liability is equal to the future fixed minimum lease payments discounted using the Company’s incremental borrowing rate, on a secured basis. The lease term includes optional renewal periods and early termination payments when it is reasonably certain that the Company will exercise those rights. The initial measurement of the right-of-use asset is equal to the initial lease liability plus any initial direct costs and prepayments, less any lease incentives. As of June 30, 2026 and December 31, 2025, the Company did not provide impairment against operating lease right-of-use assets.
Investment
Investments in equity without readily determinable fair value
Investments without readily determinable fair values (which are classified as Level 3 investments in the fair value hierarchy) use a determinable available measurement alternative in accordance with ASC 321, “Investments—Equity Securities”. The measurement alternative requires the investments to be held at cost and adjusted for impairment and observable price changes, if any.
Historically, for the investee company over which the Company did not have significant influence and a controlling financial interest, the Company accounts for these as cost method investments under ASC 325-20. These financial instruments are carried at cost, less any impairment (assessed yearly), plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer. In addition, income is recognized when dividends are received only to the extent they are distributed from net accumulated earnings of the investee. Otherwise, such distributions are considered returns of investment and are recorded as a reduction on the cost of the investment.
Property and equipment
Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over their estimated useful lives of the assets with no residual value.
| Useful Life | ||
| Office equipment and furnishings |
The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of income and other comprehensive income. Expenditures for maintenance and repairs are charged to expense as incurred, while additions, renewals and betterments, which are expected to extend the useful life of an asset, are capitalized. The Company also re-evaluates the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful lives.
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HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies (cont.)
Intangible assets, net
Intangible assets are originally recognized at cost. The useful lives of intangible assets are assessed to either be finite or indefinite based on the nature of the intangible assets. The Company’s intangible assets represent Type 4 and Type 9 licenses acquired which allows the Company to conduct Type 4 (advising on securities) and Type 9 (asset management) regulated activities under the SFO in Hong Kong. Pursuant to the provisions of SFO, there is no expiry date for Type 4 and Type 9 licenses, and there are no laws, regulations or contractual agreements restricting the expiry date of Type 4 and Type 9 licenses, and the minimum regulatory capital requirements for Type 4 and Type 9 licenses are not material in amount, so management has determined that such assets have indefinite useful lives. These intangible assets are not amortized and are tested for impairment annually either individually or at the cash-generating unit level. These intangible assets are also evaluated annually to determine whether indefinite life assessment continues to be supportable. If not, the change in the useful life assessment from indefinite to finite is accounted for on a prospective basis.
Impairment for long-lived assets
The Company reviews long-lived assets, including property and equipment and intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the undiscounted future pre-tax cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Fair value is generally determined by discounting the cash flows expected to be generated by the asset (asset Company), when the market prices are not readily available.
The adjusted carrying amount of the asset is the new cost basis and is depreciated over the asset’s remaining useful life. Long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. As of June 30, 2026 and December 31, 2025, no impairment of long-lived assets was recognized.
Account payable
Accounts payable arise from the Company’s management consulting services. The Company may delegate part of the tasks to third-party companies depending on the contents of the consulting services, and the account payable represent amounts not settled with those suppliers.
Deferred revenue
Deferred revenue represents advance payments received from customers before all of the relevant criteria for revenue recognition are met.
Other payables and accrued liabilities
Accrued liabilities mainly include accrued rent and operating expenses. Other payables consist primarily of accrual of compliance fee, as well as salaries payable which was settled on the following month.
Business combination
The Company accounts for its business combinations using the purchase method of accounting in accordance with ASC Topic 805, “Business Combinations”. The purchase method of accounting requires that the consideration transferred to be allocated to the net assets, including separately identifiable assets and liabilities the Company acquired, based on their estimated fair values. The consideration transferred in an acquisition is measured as the aggregate of the fair values at the date of exchange of the assets given, liabilities incurred, and equity instruments issued as well as the contingent considerations as of the acquisition date. The costs directly attributable to the acquisition are expensed as incurred. Identifiable assets, liabilities and contingent liabilities acquired or assumed are measured separately at their fair value as of the acquisition date, irrespective of the extent of any non-controlling interests.
10
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies (cont.)
The excess of (i) the total of the fair value of considerations transferred, the fair value of the non-controlling interests (if any) and previously held equity interest (if any) over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in earnings.
The determination and allocation of fair values to the identifiable assets acquired, liabilities assumed and non-controlling interests is based on various assumptions and valuation methodologies requiring considerable judgment from management. The most significant variables in these valuations are discount rates, the number of years on which to base the cash flow projections, as well as the assumptions and estimates used to determine the cash inflows and outflows. The Company determines discount rates to be used based on the risk inherent in the related activity’s current business model and industry comparisons. Terminal values are based on the expected life of assets, forecasted life cycle and forecasted cash flows over that period.
Revenue recognition
The Company applied ASC Topic 606, “Revenue from Contracts with Customers” (“ASC 606”), for all periods presented.
The core principle underlying the revenue recognition standard is that the Company will recognize revenue to represent the transfer of services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange.
This will require the Company to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of services transfers to a customer. Under the guidance of ASC 606, the Company is required to (a) identify the contract(s) with a customer, (b) identify the performance obligations in the contract, (c) determine the transaction price, (d) allocate the transaction price to the performance obligations in the contract and (e) recognize revenue when (or as) the Company satisfies its performance obligation. Revenue is recognized when promised goods or services are transferred to the client in an amount that reflects the consideration expected in exchange for those goods or services.
The Company is engaged in the provision of management consulting services, asset and fund management services. The service offerings mainly comprise the following:
Type I. Corporate Management Consulting Service
Through one of its wholly owned subsidiaries in Hong Kong, Starchain, the Company provides corporate management consulting services in exchange for service fees, primarily serving clients listed on the Hong Kong Stock Exchange and U.S. stock exchanges. Starchain specializes in delivering structured and tailored consulting solutions to meet the unique needs of our clients. Specifically, these services include:
| (i) | Management consulting — providing strategic insights and recommendations to drive business growth, delivering performance management reports, advising on key performance indicators (KPIs) and how to measure and optimize performance effectively; and |
| (ii) | Regulatory compliance and governance consulting — providing comprehensive regulatory and compliance consulting services, assisting to mitigate compliance risks and adopt best practices for corporate governance, ensuring compliance during company setup and maintaining statutory records to uphold proper corporate governance. |
The Company enters into consulting agreements with its customers for the provision of management consulting services. The scope of work under management consulting services can vary from contract to contract.
Such contracts generally stipulates the Company to fulfil certain discrete tasks such as submitting relevant reports (such as market research reports, regulatory compliance reports, business development reports) in accordance with the clients’ specific requirements within the specified time frame. The contract term generally requires the client to pay upfront payment upon signing the contract and outlines distinguishable price of each separate service, the criteria for completion of each service and the terms of payment. As this type of contract involves several unrelated, divisible or distinct tasks, the Company concludes that each service under the contract to be accounted for as a separate performance obligation. Revenue is recognized based on the point in time of receiving confirmation letters from clients because it is the time when the performance obligation for consulting services is satisfied.
11
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies (cont.)
Apart from the above mentioned services, the Company is also engaged to provide execution services over a certain period of time, such as assisting the client in maintaining client relationships, improving operational efficiency, liaising with various professional parties etc. The Company concludes that such services (i) is distinct and (ii) meets the criteria for recognizing revenue over time.
For corporate management consulting service, the Company considers itself as provider of the services as it has control of the specified services at any time before it is transferred to the customers which is evidenced by (i) the Company is primarily responsible for the services provided (ii) having rights in select third party vendors for simple services and establish pricing (iii) the Company does integrate different services by itself and outsourced vendors with the Company’s promise to provide the services according to the contract. Therefore, the Company acts as the principal of these arrangements and reports revenue on a gross basis.
Type II. Asset Management Service
Through our wholly owned subsidiaries in the Cayman Islands, British Virgin Islands, and Hong Kong — namely HF Fund SPC, HF CM, and HF IAM — we currently offer asset management services exclusively to professional investors.
HF Fund SPC is an open-ended investment fund regulated by the CIMA, and focuses its investment in the secondary market, primarily targeting publicly listed companies in the global technology and innovation sectors. HF CM is an approved investment manager registered with the FSC, and acts as the investment manager of HF Fund SPC. HF IAM is an entity with Type 1 (dealing in securities), Type 4 (advising on securities) and Type 9 (asset management) licenses issued by the SFC. It is qualified to provide asset management services to professional investors, including discretionary account management services, fund management, and other customized investment solutions.
HF CM handles the process of client’s subscription to HF Fund SPC, distributing fund offering documents, processing subscription applications, and conducting KYC (Know Your Customer) and AML (Anti-Money Laundering) checks. In addition, HF CM provides fund management services to HF Fund SPC, including portfolio management, compliance with investment mandates, and executing investment decisions.
HF CM previously acted as the fund manager of the Global Innovation SP portfolio under HF Fund SPC, while HF IAM serves as the investment advisor to this portfolio. While it was active, the Global Innovation SP portfolio primarily invested in public equities of global technology companies that demonstrate unique innovation and high growth potential in the RWA and blockchain sectors. The portfolio was terminated on October 31, 2025 following investors’ requests to redeem their interests in the fund. HF Fund SPC’s investors mainly consisted of high-net-worth individuals and private companies qualified as professional investors in Hong Kong.
As part of our business strategic transition, we are planning to expand the asset management services to a more tailored and sophisticated approach to investment management. This includes (i) discretionary account management services, where the fund managers will actively manage client portfolios based on predefined investment objectives, risk tolerance, and market conditions; and (ii) customized investment solutions, providing clients with personalized strategies that align with their unique investment preferences and long-term objectives. By combining in-depth market research, AI-driven analytics, and active portfolio management, we aim to enhance investment outcomes and deliver value-driven solutions that meet the evolving needs of our clients. The launch of these new services is contingent on several factors, including the necessary regulatory license and a stronger partnership with professional partners. As of the date of this report, HF IAM has submitted its application for the Type 1 (dealing in securities) license to SFC, which is pending as of the date of this report. We are also working to establish strategic partnerships with professional services providers in the industry to expand our client base.
1. Fund subscription services
The Company acts as an invest manager between funds and fund subscribers to provide fund subscription services and charges fund subscription fee at a fixed rate of the total subscription amount to fund subscriber through funds when the subscription of funds is completed. Fund subscription fee charged to fund subscribers for subscription of funds is recognized at a point in time when participating share is successfully subscribed in accordance with the provisions of the service contract.
12
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies (cont.)
The entire service fee from clients is non-refundable and there is no variable consideration, significant financing components or non-cash consideration in the contracts. Therefore, The Company concludes that fund subscription services to be accounted for as a single performance obligation and the fees as stipulated in the contract is recognized based on the point in time when the subscription of funds is completed.
2. Fund management services
The Company acts as an investment manager to the fund and provides investment services in exchange for monthly fee at a fixed rate of the total subscription amount. The Company enters a distinct contract with its clients for the provision of fund management services. The Company concludes that each monthly fund management services (i) is distinct and (ii) meets the criteria for recognizing revenue over time. In addition, the Company concludes that the services provided each month are substantially similar and result in the transfer of substantially similar services to the clients each month.
For asset management service, the Company consider itself as provider of the services, which is evidenced by (i) the Company is primarily responsible to provide asset management services to its customers; (ii) The Company has discretion in establishing the price for such services; and (iii) the Company bears the risk of the services. Therefore, the Company acts as the principal of the arrangements and reports revenue on a gross basis.
The benefit consumed by the clients is substantially similar for each month, even though the exact volume of services may vary. Therefore, the Company concludes that the monthly fund management service satisfies the requirements of ASC 606-10-25-14(b) to be accounted for as a single performance obligation. The Company recognizes revenue on a monthly basis as it meets its performance obligations throughout the term of the contract based on the fees set forth in the fund management service contract.
Disaggregation of revenue from contracts with clients, in accordance with ASC Topic 606, by major service lines is as follows:
| For the six months ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| REVENUE | ||||||||
| Corporate Management Consulting Services: | ||||||||
| Management consulting services | $ | $ | ||||||
| Management consulting services-related parties | ||||||||
| Asset Management Services: | ||||||||
| Fund management services | ||||||||
| Total | $ | $ | ||||||
Revenue disaggregated by timing of revenue recognition for the six months ended June 30, 2026 and 2025 is disclosed in the table below:
| For the six months ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Point in time: | ||||||||
| Management consulting services | $ | $ | ||||||
| Fund subscription services | ||||||||
| Over time: | ||||||||
| Management consulting services | $ | $ | ||||||
| Fund management services | ||||||||
| Total | $ | $ | ||||||
13
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies (cont.)
Operating expenses
Operating expenses mainly consist of staff costs and employee benefits, rental and office expenses, professional fees, depreciation charges and other administrative expenses.
Employee benefits
The principal employee’s retirement scheme is under the Hong Kong Mandatory Provident Fund Schemes Ordinance. Contributions are made by both the employer and the employee at the rate of
Income taxes
HF Fund and Hang Feng are not subject to tax on income or capital gains under the current laws of the Cayman Islands. HF CM, Shine Prosperity are not subject to tax on income or capital gains under the current laws of the British Virgin Islands. Although HF CM is established in BVI, its income may be recognized by the Hong Kong Inland Revenue Department as being subject to income tax as its operations and management are located in Hong Kong. HF CM accrued this portion of its income taxes based on taxable income in an amount of $
Deferred income taxes are recognized when temporary differences exist between the tax bases of assets and liabilities and their reported amounts in the unaudited condensed consolidated financial statements.
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period including the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.
An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination. The amount recognized is the largest amount of tax benefit that is greater than
Share-Based Compensation
The Company measures share-based compensation related to the issuance of RSUs to consultants based on the grant-date fair value of the awards and recognizes the expense over the requisite service period in which the related services are rendered. RSU awards granted to consultants in connection with the design, development and implementation of the Company’s real-world asset (“RWA”) platform are classified as equity-settled awards and are recognized as share-based compensation expense within research and development expenses in the consolidated statements of operations, with a corresponding increase to additional paid-in capital.
As the RSUs are with performance-based vesting conditions (vesting contingent on achievement of specified RWA platform development milestones), compensation cost is recognized over the period that management satisfied with the performance conditions and is adjusted prospectively if expectations change. Upon vesting and settlement of RSUs in shares, the Company reclassifies the balance from additional paid-in capital – RSU to ordinary share capital and additional paid-in capital; no subsequent fair value adjustments are recorded for equity-classified awards.
An award cancelled without a replacement award or other consideration provided to the grantee is accounted for as a repurchase for no consideration. If the cancellation occurs before the employee completes the requisite service period, or before a nonemployee completes the applicable vesting period, the Company recognizes any previously unrecognized compensation cost on the cancellation date. As a cancellation does not constitute an award forfeiture, compensation cost recognized before the cancellation is not reversed. When an award is forfeited, the effect of awards for which the requisite service is not rendered is recognized. Previously recognized compensation cost for an award shall be reversed in the period that the award is forfeited.
14
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies (cont.)
Related parties
The Company adopted ASC 850, “Related Party Disclosures”, for the identification of related parties and disclosure of related party transactions. Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or significant influence of the same party, such as a family member or relative, shareholder, or a related corporation.
Comprehensive income (loss)
Comprehensive income (loss) is comprised of net income (loss) and all changes to the statements of shareholders’ equity (deficit), except those due to investments by shareholders, changes in paid-in capital and distributions to shareholders. For the Company, comprehensive income (loss) consisted of net income (loss) and unrealized gain (loss) from foreign currency translation adjustment.
Earnings (Loss) per share
The Company reports basic earnings or loss per share in accordance with FASB ASC 260, “Earnings Per Share”. Basic earnings per share is computed using the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share is computed using the weighted average number of common shares outstanding plus the effect of dilutive securities during the reporting period. Any potentially dilutive securities that have an anti-dilutive impact on the per share calculation are excluded. During periods in which the Company reports a net loss, diluted weighted average shares outstanding are equal to basic weighted average shares outstanding because the effect of the inclusion of all potentially dilutive securities would be anti-dilutive. For six-months periods ended June 30, 2026 and 2025, there were potentially dilutive securities considered in the calculation of diluted loss per common share due to net losses for each period.
Commitment and contingencies
In the normal course of business, the Company is subject to loss contingencies, such as legal proceedings and claims arising out of its business, which cover a wide range of matters, including, among others, government investigations and tax matters.
In accordance with FASB ASC 450-20, “Loss Contingencies”, the Company records accruals for such loss contingencies when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated.
Recently issued accounting pronouncements
In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The amendments require that a public entity disclose, on an annual and interim basis, an amount for other segment items by reportable segment and a description of its composition. The other segment items category is the difference between segment revenue less the segment expenses disclosed under the significant expense principle and each reported measure of segment profit or loss. The amendments improve financial reporting by requiring disclosure of incremental segment information on an annual and interim basis for all public entities. The amendments in ASU 2023-07 are effective for years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, adopted retrospectively. The Company considers that the guidance will not have a significant impact on the disclosures set out in these unaudited condensed consolidated financial statements (see Note 12).
In December 2023, the FASB issued ASU 2023-09, Income taxes (Topic 740), Improvements to Income Tax Disclosures, which provides guidance on the requirements such as the requirement that public business entities on an annual basis (i) disclose specific categories in the rate reconciliation and (ii)) provide additional information for reconciling items that meet a quantitative threshold. For public business entities, the new requirements will be effective for annual periods beginning after December 15, 2024. For entities other than public business entities, the requirements will be effective for annual periods beginning after December 15, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The ASU should be applied prospectively. Retrospective application is permitted. The Company considers that the guidance will not have a significant impact on the disclosures set out in these unaudited condensed consolidated financial statements (see Note 10).
15
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 2 — Summary of significant accounting policies (cont.)
In May 2024, the FASB issued ASU 2024-05, which is an update to ASU Update No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which introduced the expected credit losses methodology for the measurement of credit losses on financial assets measured at amortized cost basis, replacing the previous incurred loss methodology. The amendments in Update 2016-13 added Topic 326, Financial Instruments — Credit Losses, and made several consequential amendments to the Codification. Update 2016-13 also modified the accounting for available-for-sale debt securities, which must be individually assessed for credit losses when fair value is less than the amortized cost basis, in accordance with Subtopic 326-30, Financial Instruments — Credit Losses — Available-for-Sale Debt Securities. The amendments in this ASU address those stakeholders’ concerns by providing an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis. For those entities, the targeted transition relief will increase comparability of financial statement information by providing an option to align measurement methodologies for similar financial assets. Furthermore, the targeted transition relief also may reduce the costs for some entities to comply with the amendments in Update 2016-13 while still providing financial statement users with decision-useful information. ASU 2024-05 is effective for the Company for annual and interim reporting periods beginning January 1, 2023 after FASB delayed the effective date for non-public companies with ASU 2024-09. The Company considers that the guidance will not have a significant impact on the disclosures set out in these unaudited condensed consolidated financial statements (see Note 2).
In November 2024, the FASB issued ASU 2024-03, “Income Statement–Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”), which requires the disaggregation of certain expenses in the financial statements notes, to provide enhanced transparency into the expense captions presented on the face of the consolidated statement of operations. ASU 2024-03 is effective for annual reporting periods beginning January 1, 2027 and interim periods beginning January 1, 2028 and may be applied either prospectively or retrospectively. The Company is currently evaluating the impact that ASU 2024-03 will have on its related disclosures, and the transition method.
On January 6, 2025, the FASB issued ASU 2025-01, “Income Statement – Comprehensive Income – Expense Disaggregation Disclosure (Subtopic220-40): Clarifying the Effective Date.” This pronouncement revises the effective date of ASU 2024-03 and clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Entities within the ASU’s scope are permitted to early adopt the accounting standard update. The Company is currently evaluating these new disclosure requirements and does not expect the adoption to have a material impact.
On July 30, 2025, the FASB issued ASU 2025-05, which amends ASC 326-20 to provide a practical expedient for all entities which elect a practical expedient that assumes that current conditions as of the balance sheet date do not change for the remaining life of the asset in developing reasonable and supportable forecasts as part of estimating expected credit losses, and an accounting policy election for all entities, other than a public business entity, that elect the practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606. Under ASU 2025-05, an entity is required to disclose whether it has elected to use the practical expedient and, if so, whether it has also applied the accounting policy election. An entity that makes the accounting policy election is required to disclose the date through which subsequent cash collections are evaluated. ASU 2025-05 is effective for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. Entities should apply the new guidance prospectively. The Company is adopting the new disclosure requirements starting January 1, 2026 and has no material impact on adoption of ASU2025-05.
In December 2025, the FASB issued ASU 2025-11, which is intended to improve the navigability of the guidance in ASC 270 and clarify when it applies. Under the amendments, an entity is subject to ASC 270 if it provides interim financial statements and notes in accordance with GAAP. The ASU also addresses the form and content of such financial statements, adds lists to ASC 270 of the interim disclosures required by all other Codification topics, and establishes a principle under which an entity must disclose events since the end of the last annual reporting period that have a material impact on the entity. As the Board stated in the proposed guidance and reiterates in the ASU, the amendments are not intended to change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements. For public business entities, the amendments in ASU 2025-11 are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. For entities other than public business entities, for interim reporting periods within annual reporting periods beginning after December 15, 2028. Early adoption is permitted for all entities. The Company is currently evaluating these new disclosure requirements and does not expect the adoption to have a material impact.
An entity that elects to early adopt the amendments in an interim period should reflect any adjustments as of the beginning of the annual period that includes that interim period. Additionally, an entity that elects early adoption must adopt all the amendments in the same period. The Company is currently evaluating the impact of this new standard on Company’s unaudited condensed consolidated financial statements and related disclosures.
Except as mentioned above, the Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets, statements of income and comprehensive income and statements of cash flows.
16
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 3 — Other receivables and prepaid expenses
Other receivables and prepaid expenses consist of the following:
| June 30, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Rent deposits | $ | $ | ||||||
| Prepaid expenses | ||||||||
| Total | $ | $ | ||||||
Note 4 — Property and equipment, net
Property and equipment consist of the following:
| June 30, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Office Furniture & Equipment * | $ | $ | ||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Total | $ | $ | ||||||
| * |
Depreciation expense for the six months ended June 30, 2026 and 2025 amounted to $
Note 5 — Intangible assets
Intangible assets consist of the following:
| June 30, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
License (Type 4: Advising on securities; and Type 9: Asset management) | $ | $ | ||||||
The licenses of Type 4 and Type 9 have eligibility rights to provide advisory services on securities and asset management in Hong Kong. Management has determined that such assets have indefinite useful lives. As of June 30, 2026 and December 31, 2025, impairment of Intangible assets was recognized.
Note 6 — Investment
The following table sets forth the Company’s equity securities without readily determinable fair value:
| June 30, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Investments in equity without readily determinable fair value | $ | $ | ||||||
In December 2025, the Company acquired
17
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 7 — Lease
As of June 30, 2026, the Company had one office space lease agreement with one unrelated third party under non-cancellable operating lease, with
The Company determines whether a contract is or contains a lease at inception of the contract and whether that lease meets the classification criteria of a finance or operating lease. When available, the Company uses the rate implicit in the lease to discount lease payments to present value; however, most of the leases do not provide a readily determinable implicit rate. Therefore, the Company discount lease payments based on an estimate of the incremental borrowing rate.
For operating leases that include rent holidays and rent escalation clauses, the Company recognizes lease expense on a straight-line basis over the lease term from the date it takes possession of the leased property. The Company records the straight-line lease expense and any contingent rent, if applicable, in general and administrative expenses on the consolidated statements of income and comprehensive income. The corporate office lease also requires the Company to pay property management expenses which are included in the general and administrative expenses on the condensed consolidated statements of income and comprehensive income.
The lease agreements do not contain any material residual value guarantees or material restrictive covenants.
For short-term leases, the Company records operating lease expense in its consolidated statements of income and comprehensive income on a straight-line basis over the lease term and record variable lease payments as incurred.
The following table represents the operating lease right-of-use assets and lease liabilities as of June 30, 2026 and December 31, 2025:
| June 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| (unaudited) | ||||||||
| Leases | ||||||||
| Assets: | ||||||||
| Operating lease right-of-use assets, net | $ | $ | ||||||
| Liabilities: | ||||||||
| Current | ||||||||
| Lease liabilities | $ | $ | ||||||
| Non-current | ||||||||
| Lease liabilities | ||||||||
| Total lease liabilities | $ | $ | ||||||
Operating lease expense includes ROU amortization and short-term rental charges, which were $
The following table represents the maturity of lease liabilities, by lease classification, as of June 30, 2026.
| Years ending December 31, | Total | |||
| 2026 | $ | |||
| 2027 | ||||
| Total operating lease payments | ||||
| Less: imputed interest | ( | ) | ||
| Present value of operating lease liabilities | $ | |||
18
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 7 — Lease (cont.)
Other lease information is as follow:
| Weighted-average remaining lease term (years): | June 30, 2026 | |||
| Operating leases – office space | ||||
| Weighted-average discount rate: | ||||
| Operating leases | % | |||
The following table represents the minimum cash lease payments included in the measurement of lease liabilities for the periods presented.
| June 30, 2026 | June 30, 2025 | |||||||
| (unaudited) | (unaudited) | |||||||
| Cash paid for amounts included in the measurement of lease liabilities: | ||||||||
| Cash outflows for operating leases | $ | $ | | |||||
Note 8 — Other payables and accrued liabilities
Other payables and accrued liabilities consist of the following:
| June 30, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Salary payable | ||||||||
| Others | ||||||||
| Total | $ | $ | ||||||
Note 9 — Deferred revenue
Deferred revenue represents advance payments received from customers before all of the relevant criteria for revenue recognition are met.
| June 30, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Beginning balance | ||||||||
| Customer advances | ||||||||
| Related party advances | ||||||||
| Recognized as revenues | ( | ) | ( | ) | ||||
| Effect of exchange rate | ( | ) | ||||||
| Ending balance | $ | $ | ||||||
19
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 10 — Taxes
Cayman Islands
Hang Feng and HF Fund were incorporated in the Cayman Islands and are not subject to taxation. In addition, upon payments of dividends by these entities to their shareholders, no Cayman Islands withholding tax will be imposed.
British Virgin Islands
Shine Prosperity, HF CM, Hang Feng Offshore Holdings Limited and Hang Feng Horizon SPC were incorporated in the British Virgin Islands and are not subject to taxation. In addition, upon payments of dividends by these entities to their shareholders, no British Virgin Islands withholding tax will be imposed.
Singapore
The Company’s Singapore subsidiary, HF Helios AI Pte. Limited, is subject to income tax on its taxable income as reported in its statutory financial statements, adjusted in accordance with the relevant tax laws and regulations of Singapore. The applicable corporate income tax rate in Singapore is
Hong Kong
The Company’s Hong Kong subsidiaries (Starchain and HF IAM) are subject to Hong Kong profits tax at a rate of
1.
| For the six months ended June 30, 2026 | For the six months ended June 30, 2025 | |||||||
| (Unaudited) | (Unaudited) | |||||||
| Hong Kong profits tax provision for the six-months period ended: | ||||||||
| Current | $ | $ | ||||||
| Deferred | ( | ) | ( | ) | ||||
| Income tax (benefits) expenses | $ | ( | ) | $ | ||||
Although HF CM was incorporated in BVI, its income may be recognized by the Hong Kong Inland Revenue Department as being subject to income tax as its operations and management are located in Hong Kong. The Company recognized this portion of its income tax benefits based on tax losses carryforward and accrued this portion of its income taxes based on taxable income in an amount of US$
2. Deferred tax assets
The following table summarizes the significant components of deferred tax assets.
| June 30, 2026 | December 31, 2025 | |||||||
| (Unaudited) | ||||||||
| Opening balances | $ | $ | ||||||
| Addition of tax losses carryforward | ||||||||
| Utilized during the period | ( | ) | ||||||
| Exchange rate difference | ( | ) | ( | ) | ||||
| Less: valuation allowance | ||||||||
| Deferred tax assets, net | $ | $ | ||||||
The Company evaluated the recoverable amounts of deferred tax assets, and provided a valuation allowance to the extent that future taxable profits will be available against which the net operating loss and temporary difference can be utilized. The Company considers both positive and negative factors when assessing the future realization of the deferred tax assets and applied weight to the relative impact of the evidences to the extent it could be objectively verified. As of June 30, 2026 and December 31, 2025, there were no valuation allowances recognized.
As of June 30, 2026 and December 31, 2025, the Company had net operating loss carry forwards indefinitely of US$
20
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 10 — Taxes (cont.)
Uncertain Tax Position
As of June 30, 2026 and December 31, 2025, the unrecognized tax benefits were nil, respectively, which would affect the effective tax rate if recognized. The Company recognizes interest and penalty charges related to uncertain tax positions as necessary in the provision for income taxes. As of June 30, 2026 and December 31, 2025, no interest expense or penalty was accrued in relation to the unrecognized tax benefit.
In general, the Hong Kong tax authority has up to six years to conduct examinations of the Company’s tax filings. As of June 30, 2026, tax years ended December 31, 2019 through December 31, 2025 remain open for statutory examination by tax authorities.
Note 11 — Concentration of credit risk
Credit risk
Assets that potentially subject the Company to a significant concentration of credit risk primarily consist of cash and cash equivalents, accounts receivable.
The Company believes that there is no significant credit risk associated with cash and cash equivalents, which were held by reputable financial institutions in the jurisdictions where the Company and its subsidiaries are located. The Hong Kong Deposit Protection Board pays compensation up to a limit of approximately US$
The Company has designed their credit policies with an objective to minimize their exposure to credit risk. The Company’s accounts receivable are short term in nature and the associated risk is minimal. The Company conducts credit evaluations on its clients and generally does not require collateral or other security from such clients. The Company periodically evaluates the creditworthiness of the existing clients in determining an allowance for expected credit losses primarily based upon the age of the receivables and factors surrounding the credit risk of specific clients. The risk with respect to accounts receivable is mitigated by credit evaluations the Company performs on its customers and its ongoing monitoring processes of outstanding balances.
Interest Rate Risk
The Company’s exposure to interest rate risk primarily relates to the interest income generated by excess cash, which is mostly held in interest-bearing bank deposits. The Company has not used any derivative financial instruments to manage its interest risk exposure. Interest-earning instruments carry a degree of interest rate risk. The Company has not been exposed, nor do the Company anticipate being exposed, to material risks due to changes in interest rates. However, the Company’s future interest income may be lower than expected due to changes in market interest rates.
Foreign currency risk
The reporting currency of the Company is U.S. Dollar. To date a large portion of the revenues and expenses are denominated in Hong Kong Dollar and a large portion of the assets and liabilities are denominated in Hong Kong Dollars. There was no significant exposure to foreign exchange rate fluctuations and the Company has not maintained any hedging policy against foreign currency risk. The management will consider hedging significant currency exposure should the need arise.
Inflation Risk
The Company does not believe that inflation has had a material effect on the Company’s business, financial condition or results of operations, other than its impact on the general economy. Nonetheless, if The Company’s operating expenses were to become subject to inflationary pressures, the Company may not be able to fully offset such higher expenses through price increases. The Company’s inability or failure to do so could harm the Company’s business, financial condition and results of operations.
Customer concentration risk
Details of the clients accounting for 10% or more of total operating revenue are as follows:
| For the six months ended June 30, | ||||||||||||||||
| 2026 | 2025 | |||||||||||||||
| US$ | % | US$ | % | |||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||
| Customer A | ||||||||||||||||
| Customer B | ||||||||||||||||
| Customer C | ||||||||||||||||
| Total | $ | $ | ||||||||||||||
21
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 11 — Concentration of credit risk (cont.)
Details of the clients which accounted for 10% or more of accounts receivable are as follows:
| As of June 30, 2026 | As of December 31, 2025 | |||||||||||||||
| US$ | % | US$ | % | |||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||
| Accounts receivable from third party: | ||||||||||||||||
| Customer A | $ | $ | ||||||||||||||
| Customer B | ||||||||||||||||
| Accounts receivable from a related party | ||||||||||||||||
| Total accounts receivable | $ | $ | ||||||||||||||
Note 12 — Segment reporting
The Company uses the management approach to determine reportable operating segments. The Company does not distinguish revenues, costs and expenses between segments in its internal reporting, but instead reports costs and expenses by nature as a whole. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making decisions, allocating resources and assessing performance. Based on the management’s assessment, the Company determines that it has only
Note 13 — Related party balances and transactions
1. Transactions with related parties
| Name of Related Party | Nature | Relationship | For the six months ended June 30, 2026 | For the six months ended June 30, 2025 | ||||||||
| (Unaudited) | (Unaudited) | |||||||||||
| Hang Feng International Holdings Co., Limited | ||||||||||||
| Hang Feng International Holdings Co., Limited | ||||||||||||
| Total | $ | $ | ||||||||||
2. Proceeds from related parties
| Name of Related Party | For the six months ended June 30, 2026 | For the six months ended June 30, 2025 | ||||||||||||||
| Borrowing | Repayment | Borrowing | Repayment | |||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||
| YEUNG Sing Yuet Sherry | $ | $ | $ | $ | ( | ) | ||||||||||
| Hang Feng International Holdings Co., Limited | ( | ) | ||||||||||||||
| Total | $ | $ | $ | $ | ( | ) | ||||||||||
22
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 14 — Shareholders’ Equity
Hang Feng was established under the laws of Cayman Islands on October 15, 2024 as an exempt company with limited liability and as a wholly owned subsidiary of HF Holdings. The authorized number of ordinary shares is
On December 30, 2024, Hang Feng issued an aggregate of
On February 24, 2025, the Company effected a stock split at a ratio of
On September 15, 2025, the Company closed its initial public offering (“IPO”) of
On September 16, 2025, the over-allotment option was exercised in full by the underwriters and the Company issued
After the closing of IPO and over-allotment option being exercised, the Company received a net proceeds of approximately $
On June 12, 2026, the Company passed an EGM to approve the redesignation and reclassification, increase and reduction of its authorised share capital. The share redesignation and reclassification, and the increase in authorized share capital became effective upon shareholder approval of such proposals on June 12, 2026, while the reduction of share capital will be deemed effective as of the initial submission date of the relevant documents to the Cayman Registry, being June 22, 2026, subject to the approval by the Cayman Registry. As of the date of this filing, the documents submitted by the Company are still pending approval by the Cayman Registry. As a result, the authorized share capital has been reclassified into Class A ordinary shares and Class B ordinary shares, consisting of
Share-Based Compensation
On November 8, 2025, the Company filed Form S-8 in order to register
On November 12, 2025, the Company engaged with four consultants and grant them on November 14, 2025 a total of
23
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 14 — Shareholders’ Equity (cont.)
On April 17, 2026, all parties agreed to forfeit the remaining restricted shares unit with the discontinued services which originally planned in the first three quarters of 2026 due to the Company’s shift of focus. The unvested
On June 23, 2026, the Company issued
The Company evaluated the performance conditions associated with the RSU grants and determined that the performance condition for the fourth quarter of 2025 was probable of achievement as of December 2, 2025. This assessment was based on several factors, including (i) confirmation that the project plans and milestones were feasible prior to execution of the consulting agreements, (ii) ongoing communication with the consultants throughout the engagement, and (iii) completion and acceptance of the first-phase deliverables, evidenced by the Company’s execution of a service completion receipt confirming satisfactory performance.
The activity in share-based compensation is set out below:
| Number of restricted share unit outstanding | Weighted average grant date fair value | Aggregate intrinsic value** | ||||||||||
| Restricted share units outstanding at January 1, 2025 | $ | |||||||||||
| Forfeited | ||||||||||||
| Restricted share units outstanding at June 30, 2025 | ||||||||||||
| Restricted share units outstanding at January 1, 2026* | ||||||||||||
| Granted | ||||||||||||
| Vested | ||||||||||||
| Forfeited | ||||||||||||
| Restricted share units outstanding at June 30, 2026 | $ | |||||||||||
| * | |
| ** |
24
HANG FENG TECHNOLOGY INNOVATION CO., LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 15 — Commitments and Contingencies
In the normal course of business, the Company is subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. The Company recognizes a liability for such contingency if it determines it is probable that a loss has occurred and a reasonable estimate of the loss can be made. The Company may consider many factors in making these assessments including historical factors and the specific facts and circumstances of each matter.
Although the outcomes of these legal proceedings cannot be predicted, the Company does not believe these actions, in the aggregate, will have a material adverse impact on its financial position, results of income or liquidity.
Note 16 — Regulatory Requirements
The following table illustrates the minimum regulatory capital as established by the SFC that the Company’s subsidiary, HF IAM, is required to maintain as of June 30, 2026 and the actual amounts of capital that were maintained:
| As of June 30, 2026 | ||||||||||||||||
| Minimum regulatory capital requirement | Capital levels maintained | Excess net capital | Percent of requirement maintained | |||||||||||||
| HKD’000 | HKD’000 | HKD’000 | ||||||||||||||
| HF IAM | ||||||||||||||||
The Company’s operation subsidiary maintains a capital levels greater than the minimum regulatory capital requirements and it is in compliance with the minimum regulatory capital established by the SFC.
Note 17 — Subsequent Events
On July 7, 2026, HFIAM has been granted a Type 1 regulated activity license by the Securities and Futures Commission of Hong Kong. The license enables HFIAM to provide a range of securities dealing activities, including the distribution services to professional investors. The Company does not have any plans to commence securities-dealing activities as of the date of this filing.
As of the date of this Filing, the Cayman Registry has yet to approve the share capital reduction, the resolution for which was passed at the EGM held on June 12, 2026.
The Company has analyzed, in accordance with ASC 855-10, its operations through the date these unaudited condensed consolidated financial statements were issued, and has determined that, there are no additional material subsequent events to disclose in these unaudited condensed consolidated financial statements other than noted above.
25
Exhibit 99.2
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
You should read the following discussion and analysis of the Company’s financial condition and results of operations in conjunction with the Company’s unaudited condensed consolidated financial statements and the related notes included elsewhere in this report. This discussion may contain forward-looking statements based upon current expectations that involve risks and uncertainties. The Company’s actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Item 3. Key Information - 3.D. Risk Factors” or in other parts of the annual report on Form 20-F for the fiscal year ended December 31, 2025, of the Company filed on April 16, 2026.
Overview
Incorporated as an exempted company with limited liability in the Cayman Islands on October 15, 2024, we operate as a holding company with no material operations. Since 2023, we have been identifying market opportunities and offering consulting services through Starchain to a growing network of clients. Starting in 2024, we began offering asset management services through HF CM, HF IAM and HF Fund SPC. In November 2025, we initiated a new development within our asset management business to explore the real-world assets (“RWA”) tokenization, specifically, the tokenization of interests in its fund-of-funds (“FoF”) portfolios. In light of evolving market conditions, as of the date of this report, the management has decided to defer the launch of the proof-of-concept that had been planned for the second quarter of 2026. We will continue to monitor market developments and will reassess the timing of any future launch as conditions warrant. As of the date of this report, all our business activities are conducted through our direct and indirect wholly owned subsidiaries. We have two main business lines: (i) corporate management consulting services and (ii) asset management services.
Corporate Management Consulting Services
Through one of our wholly owned subsidiaries in Hong Kong, Starchain, we provide corporate management consulting services in exchange for service fees, primarily serving clients listed on the Hong Kong Stock Exchange and U.S. stock exchanges. Our largest client for the six months ended June 30, 2025, is a related party of the Company, HF Holdings, which is the largest shareholder of the Company. The largest client for the six months ended June 30, 2026 is a private company.
Starchain specializes in delivering structured and tailored consulting solutions to meet the unique needs of our clients. Specifically, these services include:
| (i) | Management consulting — providing strategic insights and recommendations to drive business growth, delivering performance management reports, advising on key performance indicators (KPIs) and how to measure and optimize performance effectively; and |
| (ii) | Regulatory compliance and governance consulting — providing comprehensive regulatory and compliance consulting services, assisting to mitigate compliance risks and adopt best practices for corporate governance, ensuring compliance during company setup and maintaining statutory records to uphold proper corporate governance. |
Asset Management Services
Through our wholly owned subsidiaries in Cayman Islands, British Virgin Islands and Hong Kong, HF Fund SPC, HF CM, and HF IAM, we provide asset management services, including fund subscription and fund management services, and receive subscription fees and management fees accordingly. HF CM handles the process of client’s subscription to HF Fund SPC, distributing fund offering documents, processing subscription applications, and conducting KYC (Know Your Customer) and AML (Anti-Money Laundering) checks. In addition, HF CM provides fund management services to HF Fund SPC, including portfolio management, compliance with investment mandates, and executing investment decisions.
HF CM previously acted as the fund manager of the Global Innovation SP portfolio under HF Fund SPC, while HF IAM served as the investment advisor to this portfolio. While it was active, the Global Innovation SP portfolio primarily invests in public equities of global technology companies that demonstrate unique innovation and high growth potential in the RWA and blockchain sectors, the portfolio was terminated on October 31, 2025. HF Fund SPC’s investors mainly consisted of high-net-worth individuals and private companies qualified as professional investors in Hong Kong.
In November 2025, we initiated a new development within our asset management business to explore the RWA tokenization, specifically, the tokenization of interests in its FoF portfolios. The RWA tokenization initiative remains at an early stage of development. We are in the process of establishing the SPV and has engaged legal advisors to structure it in compliance with applicable regulations. The working group plans to launch a proof-of-concept by the second quarter of 2026, which is a preliminary pilot designed to validate the operational workflow and assess the feasibility of offering tokenized fund interests through regulated digital platforms. In light of evolving market conditions, the management has decided to defer the launch of the proof-of-concept for now. The Company will continue to monitor market developments and will reassess the timing of any future launch as conditions warrant.
For the six months ended June 30, 2026 and 2025, our total revenue was approximately US$362,511 and US$1,327,707, respectively. Of this, revenue from corporate management consulting services accounted for approximately US$362,511 in 2026 and US$1,076,041 in 2025, or approximately 100.0% and 81.0%, respectively. Revenue from asset management services contributed approximately US$0 in 2026, compared to $251,666, or approximately 19.0% in 2025.
Key Factors Affecting Our Results of Operations
Our business and results of operations are affected by a number of general factors that impact our ability to capitalize on the growth of our total addressable market, including overall economic growth in Hong Kong and globally, technological advancement, geopolitical relations, regulatory oversight and competitive landscape within our industry. Changes in any of these general factors could affect our business and results of operations.
In light of the current stage of our development, particularly our business expansion efforts, we believe our future financial position and operational results depend to a significant extent on (i) market conditions in the capital and financial markets in Hong Kong, (ii) regulatory environment, including rules and regulatory requirements imposed by relevant regulatory authorities and government agencies in Hong Kong, (iii) customer growth and retention, specifically our ability to develop a new client network and maintain existing relationships, (iv) industry competition within the corporate management consulting and asset management sectors in Hong Kong, and (v) our ability to manage our staff costs and expenses, as elaborated below:
Market conditions in the capital and financial markets in Hong Kong
A majority of our business operations were carried out in Hong Kong. Our results of operations and prospects are highly susceptible to any development of change in government policies, as well as economic, social, political and legal development in Hong Kong. Events with adverse impacts on investors’ confidence and risk appetites, such as riots or mass civil disobedience movements and general deterioration of the local economy, may lead to a reduction in investment or trading activities and in turn our business performance. Any change in the Hong Kong local economic, social and political environment, all of which are beyond our control, may lead to a prolonged period of sluggish market activities which would in turn have material adverse impact on our business.
The capital market and the economic conditions in general of Hong Kong are highly sensitive to conditions of the capital markets, political, social and economic conditions in mainland China and globally. When there are unfavorable changes to the global or local market conditions, the capital market and the economy in Hong Kong may experience negative fluctuations in its performance. Any prolonged slowdown in the global or Chinese economy may affect potential clients’ confidence in the capital market as a whole and have a negative impact on our business as a whole, the demand for our services, our pricing strategies, the level of our business activities and consequently our revenue derived therefrom, which in turn may have a material adverse effect on our financial condition and operational results.
Regulatory environment, including rules and regulatory requirements imposed by relevant regulatory authorities and government agencies in Hong Kong
The asset management services industry in which our subsidiaries operate is subject to stringent regulation and oversight by various regulatory authorities across different jurisdictions. Many aspects of asset management require obtaining and maintaining approvals, licenses, permits or qualifications from the relevant regulatory bodies. Serious violations of regulatory requirements may lead to investigations and regulatory actions, potentially resulting in penalties, such as reprimands, fines, business restrictions or prohibitions. In severe cases, non-compliance could lead to the suspension or revocation of our licenses, limiting the scope of business we are authorized to conduct. In addition, the relevant regulatory authorities may impose additional regulatory approvals, licenses, permits or qualifications in the future. To date, neither we nor our subsidiaries have been found in material breach of any regulatory requirements. However, any adverse regulatory finding or enforcement action could impact our ability to conduct our business, damage our reputation, and, in turn, have a material adverse effect on our business, financial condition, results of operations, and future prospects.
Our subsidiary, HF IAM, is an entity with Type 4 (advising on securities) and Type 9 (asset management) licenses issued by the SFC and is subject to a number of regulatory requirements under the Hong Kong Securities and Futures Ordinance (SFO) and its subsidiary legislations. It must also comply with codes and guidelines issued by the SFC from time to time, which include maintaining fit and proper personnel at all times, meeting minimum liquidity and paid-up capital requirements, fulfilling notification obligations, submitting audited accounts, filing financial resources returns and annual returns, and ensuring continuous professional training. If HF IAM fails to meet the regulatory capital requirements in Hong Kong, the local regulator may impose penalties or restrict our scope of business, which in turn may have a material adverse effect on our financial condition and results of operations. In addition, the relevant capital requirements may change over time or be subject to different interpretations by the relevant government authorities — factors that are beyond our control. Any increase in, or more stringent enforcement or interpretation of, these capital requirements could adversely affect our business operations.
2
Customer growth and retention, specifically our ability to develop a new client network and maintain existing relationships
Our corporate management consulting services revenue primarily depends on a limited number of clients. The number of clients we serve is affected by market demands, our brand and reputation, the size of our target client base, our sales channels and client acquisition capabilities, the differentiation and fit of the services provided, the price of our services, referrals from our channels and partners, client retention and referrals, and other factors. Fluctuations in our client base may affect our financial performance and there is no assurance that we will be able to maintain or strengthen our relationships with our clients, as clients may choose to terminate their engagement with us at any time. Similarly, our asset management services are negotiated on a project-by-project basis, leading to potential revenue fluctuations. There is no assurance that clients who have previously engaged our services will do so in the future. As a result, our future financial results may vary depending on our ability to secure new business.
Industry competition within the corporate management consulting and asset management sectors in Hong Kong
There are a large number of existing market participants in the corporate management consulting and asset management industry in Hong Kong that provide services similar to those provided by us. Our larger competitors may have advantages over us, such as stronger brand recognition and reputation, a broader range of value-added services, stronger human and financial resources, a longer operating history, and a wider geographic presence. Additionally, we face competition from local small and medium-sized financial service providers offering comparable services. New players can also enter the market if they employ appropriately qualified professionals and obtain the necessary regulatory licenses and permits. Given the high level of competition, there can be no assurance that we will be able to maintain a competitive advantage in an evolving business environment. In addition, intense competition creates pricing pressure in the markets we serve, potentially forcing us to lower our service fees or commission rates to remain competitive. This could significantly impact our gross margins, particularly during periods of market downturn, which in turn could have a material adverse effect on our market share, financial condition and results of operations.
Climate-related risk
The Company has assessed the potential impacts of climate-related risks and opportunities on its operations, financial condition, and results of operations. As the Company primarily provides corporate management consulting and asset management services, its business activities and those of its serviced customers are not materially affected by climate-related matters. The Company does not operate in industries with significant exposure to physical or transitional risks associated with climate change, and therefore, management has determined that climate-related issues do not have a material effect on the Company’s strategy, business model, or financial performance at this time.
Our ability to manage our staff costs and expenses
Our employee costs are the largest expense we incur in the operation of our business, and our ability to manage these costs directly affects our results of operations. For the six months ended June 30, 2026 and 2025, our employee costs were approximately US$659,799 and US$464,264, respectively, accounting for 48.7% and 54.8% of total operating expenses. For the six months ended June 30, 2026, the Company’s labor cost per headcount was approximately $47,000, representing an increase of about 42.4% compared to approximately $33,000 in the prior year. This increase was due to the hiring of new expertise and salary adjustment after our successful listing on the Nasdaq Capital Market. These costs consist primarily of salaries, bonuses, and contributions to the mandatory provident fund. Unless we can manage these costs effectively, our financial condition and results of operations may be adversely affected.
3
Operating Results
The following table sets forth a summary of our consolidated results of operations for the periods presented. This information should be read together with our unaudited condensed consolidated financial statements and related notes included elsewhere in this report. The results of operations in any period are not necessarily indicative of our future trends.
Comparison of Six Months Ended June 30, 2026 and 2025
| For the Six Months Ended June 30, | Variance | |||||||||||||||
| 2026 | 2025 | Amount | % | |||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||
| Revenue: | ||||||||||||||||
| Management consulting services | $ | 362,511 | $ | 746,683 | (384,172 | ) | (51.5 | )% | ||||||||
| Management consulting services-related parties | — | 329,358 | (329,358 | ) | (100.0 | )% | ||||||||||
| Fund management revenue | — | 251,666 | (251,666 | ) | (100.0 | )% | ||||||||||
| Total revenues | 362,511 | 1,327,707 | (965,196 | ) | (72.7 | )% | ||||||||||
| Operating expenses: | ||||||||||||||||
| Staff costs and employee benefits | $ | (659,799 | ) | $ | (464,264 | ) | (195,535 | ) | 42.1 | % | ||||||
| Rental and office expenses | (91,577 | ) | (110,155 | ) | 18,578 | (16.9 | )% | |||||||||
| Professional fees | (489,584 | ) | (259,373 | ) | (230,211 | ) | 88.8 | % | ||||||||
| Research and development expenses | (56,865 | ) | — | (56,865 | ) | 100.0 | % | |||||||||
| Depreciation | (4,109 | ) | (3,975 | ) | (134 | ) | 3.4 | % | ||||||||
| Other administrative expenses | (54,194 | ) | (10,152 | ) | (44,042 | ) | 433.8 | % | ||||||||
| Total operating expenses | (1,356,128 | ) | (847,919 | ) | (508,209 | ) | 59.9 | % | ||||||||
| (Loss) income from operations | $ | (993,617 | ) | $ | 479,788 | (1,473,405 | ) | (307.1 | )% | |||||||
| Other income (expense): | ||||||||||||||||
| Interest income | 18 | 4,634 | (4,616 | ) | (99.6 | )% | ||||||||||
| Loan interest income | 329,755 | — | 329,755 | 100.0 | % | |||||||||||
| Other income (expenses) | 40,897 | (21,272 | ) | 62,169 | (292.3 | )% | ||||||||||
| Total other income (expenses), net | $ | 370,670 | $ | (16,638 | ) | 387,308 | (2,327.9 | )% | ||||||||
| (Loss) income before income taxes | (622,947 | ) | 463,150 | (1,086,097 | ) | (234.5 | )% | |||||||||
| Income tax benefits (expenses) | 69,914 | (99,626 | ) | 169,540 | (170.2 | )% | ||||||||||
| Net (loss) income | $ | (553,033 | ) | $ | 363,524 | (916,557 | ) | (252.1 | )% | |||||||
| Weighted average number of ordinary shares outstanding | ||||||||||||||||
| – basic and diluted – Class A and Class B ordinary shares | 7,584,334 | 5,290,000 | 2,294,334 | 43.4 | % | |||||||||||
| Basic and diluted – Class A and Class B ordinary shares | $ | (0.07 | ) | $ | 0.07 | (0.14 | ) | (194.3 | )% | |||||||
4
Revenues
We generate revenue primarily through providing corporate management consulting services and asset management services. Total revenues decreased by US$965,196 or 72.7%, from US$1,327,707 for the six months ended June 30, 2025, to US$362,511 for the six months ended June 30, 2026. The following table sets forth a breakdown of our revenues:
| For the Six Months Ended June 30, | Variance | |||||||||||||||||||||||
| 2026 | 2025 | US$ | % | |||||||||||||||||||||
| US$ | % | US$ | % | |||||||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||||||||
| Corporate management consulting services: | ||||||||||||||||||||||||
| Management consulting services | $ | 362,511 | 100.0 | $ | 746,683 | 69.4 | (384,172 | ) | (51.5 | )% | ||||||||||||||
| Management consulting services-related parties | — | — | 329,358 | 30.6 | (329,358 | ) | (100 | )% | ||||||||||||||||
| Total | 362,511 | 100.0 | 1,076,041 | 100.0 | (713,530 | ) | (66.3 | )% | ||||||||||||||||
| Asset management services: | ||||||||||||||||||||||||
| Fund management revenue | — | — | 251,666 | 100.0 | (251,666 | ) | (100.0 | )% | ||||||||||||||||
| Total | $ | 362,511 | 100.0 | $ | 1,327,707 | 100.0 | (965,196 | ) | (72.7 | )% | ||||||||||||||
Corporate management consulting services
Through one of our wholly owned subsidiaries in Hong Kong, Starchain, we provide corporate management consulting services in exchange for service fees, primarily serving clients listed on the Hong Kong Stock Exchange and U.S. stock exchanges. Starchain specializes in delivering structured and tailored consulting solutions to meet the unique needs of our clients. Specifically, these services include:
| (i) | Management consulting — providing strategic insights and recommendations to drive business growth, delivering performance management reports, advising on key performance indicators (KPIs) and how to measure and optimize performance effectively; and |
| (ii) | Regulatory compliance and governance consulting — providing comprehensive regulatory and compliance consulting services, assisting to mitigate compliance risks and adopt best practices for corporate governance, ensuring compliance during company setup and maintaining statutory records to uphold proper corporate governance. |
Total revenue from corporate management consulting services decreased by approximately US713,530 or 66.3%, from US$1,076,041 for the six months ended June 30, 2025, to US$362,511 for the same period in 2026. The decrease was primarily due to the Company’s shift in its strategic focus, which resulted in a reduction in business development and marketing activities for its existing operations and a reallocation of resources toward the development of its RWA initiatives. Consulting services provided to related parties decreased to nil as a result of changes in the related parties’ business focus, which eliminated their need for such consulting services.
Asset management services
Through our wholly owned subsidiaries, HF Fund SPC, HF CM and HF IAM, we provide asset management services including fund subscription and fund management services, and receive subscription fees and management fees accordingly. HF CM handles the process of client’s subscription to HF Fund SPC, distributing fund offering documents, processing subscription applications, and conducting KYC (Know Your Customer) and AML (Anti-Money Laundering) checks. In addition, HF CM provides fund management services to HF Fund SPC, including portfolio management, compliance with investment mandates, and executing investment decisions.
HF CM previously acted as the fund manager of the Global Innovation SP portfolio under HF Fund SPC, while HF IAM served as the investment advisor to this portfolio. While it was active, the Global Innovation SP portfolio primarily invested in public equities of global technology companies that demonstrate unique innovation and high growth potential in the RWA and blockchain sectors. The portfolio was terminated on October 31, 2025 following investors’ requests to redeem their interests in the fund. HF Fund SPC’s investors mainly consisted of high-net-worth individuals and private companies qualified as professional investors in Hong Kong. Total asset management revenue decreased by approximately US$251,666 from US$251,666 for the six months ended June 30, 2025 to nil for the same period in 2026. The decrease was due to the termination of current fund portfolio in September 2025.
5
Operating Expenses
| For the Six Months Ended June 30, | Variance | |||||||||||||||||||||||
| 2026 | 2025 | US$ | % | |||||||||||||||||||||
| US$ | % | US$ | % | |||||||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||||||||
| Staff costs and employee benefits | $ | (659,799 | ) | 48.7 | (464,264 | ) | 54.8 | (195,535 | ) | 42.1 | % | |||||||||||||
| Rental and office expenses | (91,577 | ) | 6.7 | (110,155 | ) | 13.0 | 18,578 | (16.9 | )% | |||||||||||||||
| Professional fees | (489,584 | ) | 36.1 | (259,373 | ) | 30.6 | (230,211 | ) | 88.8 | % | ||||||||||||||
| Research and development expenses | (56,865 | ) | 4.2 | — | — | (56,865 | ) | 100.0 | % | |||||||||||||||
| Depreciation | (4,109 | ) | 0.3 | (3,975 | ) | 0.5 | (134 | ) | 3.4 | % | ||||||||||||||
| Other administrative expenses | (54,194 | ) | 4.0 | (10,152 | ) | 1.2 | (44,042 | ) | 433.8 | % | ||||||||||||||
| Total | $ | (1,356,128 | ) | 100.0 | (847,919 | ) | 100.0 | (508,209 | ) | 59.9 | % | |||||||||||||
Our operating expenses primarily consist of staff costs and employee benefits, rental and office expenses, professional fees, depreciation, and other expenses. Our total operating expenses increased by approximately US$508,209, or 59.9%, from approximately US$847,919 for the six months ended June 30, 2025, to approximately US$1,356,128 for the six months ended June 30, 2026. This increase was mainly due to the increase in research and development expenses relating to the share issuance to a consultant for the professional services for the six months ended June 30, 2026.
Our staff costs and employee benefits increased by approximately US$195,535, or 42.1% from approximately US$464,264 for the six months ended June 30, 2025, to US$659,799 for the six months ended June 30, 2026. The increase was mainly due to the onboarding of board members in the fourth quarter of 2025 in connection with the Company listing.
Our rental and office expenses decreased by approximately US$18,578, or 16.9% from approximately US$110,155 for the six months ended June 30, 2025, to approximately US$91,577 for the six months ended June 30, 2026. The decrease in rental expenses was primarily attributable to the end of leasing of one of the Hong Kong office of HFIAM. Currently, HFIAM and Starchain share an office space in Hong Kong.
Our professional fees increased by approximately US$230,211, or 88.8% from approximately US$259,373 for the six months ended June 30, 2025, to approximately US$489,584 for the six months ended June 30, 2026. This increase was primarily due to the professional expenses to lawyers, SEC and transfer agents in relation to public filings, shareholders’ meeting, share issuance and ordinary shares to consultants.
Our research and development expense in 2026 represented the share issuance to a consultant for providing services to the Company in 2026 for US$845,780, subtracting the reversal of issuance of restricted share unit of US$788,915 in previous year, which both the Company and consultants agreed to discontinue the provision of consultancy services due to the shift of Company’s development focus.
Depreciation increased by approximately US$134, or 3.4% from approximately US$3,975 for the six months ended June 30, 2025 to approximately US$4,109 for the six months ended June 30, 2026, mainly due to exchange difference.
Other administrative expenses increased by approximately US$44,042 in 2026 compared to 2025. This increase was primarily due to the registration fees, traveling and other related fees incurred for business development.
Other income (expenses), net
Our other income mainly represented interest income, loan interest income and other expenses and income. Our other income, net increased by approximately US$387,308, or 2,327.9%, from other expenses, net of approximately US$16,638 for the six months ended June 30, 2025 to other income, net of approximately US$370,670 for the six months ended June 30, 2026, which was primarily due to the gain of interest income of US$329,755 from lending idle fund to third party in the first half year of 2026, which the entire lending was settled by the end of June 2026.
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Income tax
We are subject to income tax on an entity basis on profit arising in or derived from the jurisdiction in which we and our subsidiaries operate.
Cayman Islands
Hang Feng and HF Fund were incorporated in the Cayman Islands and are not subject to taxation. In addition, upon payments of dividends by these entities to their shareholders, no Cayman Islands withholding tax will be imposed.
British Virgin Islands
Under the current laws of the British Virgin Islands, we are not subject to tax on income or capital gains. However, the income of HF CM, a wholly owned subsidiary of us that was established in BVI, may be recognized by the Hong Kong Inland Revenue Department as being subject to income tax, because its operations and management are located in Hong Kong. We accrued this portion of income taxes based on taxable income in an amount of US$4,852 for the six months ended on June 30, 2026.
Hong Kong
Under the Inland Revenue (Amendment) (No. 3) Ordinance 2018, a two-tier profits tax rate system is introduced with effect from the year of assessment 2018/19. The profits tax rate for the first HK$2,000,000 (approximately US$256,000) of a corporation’s assessable profits will be reduced to 8.25%, while assessable profits in excess of HK$2,000,000 (approximately US$256,000) will continue to be taxed at a rate of 16.5%.
Our income tax benefit (expense) decreased by approximately US$169,540, or 170.2% in 2026 as compared to 2025. The decrease was primarily due to the fact that HF CM, HF IAM and Starchain recognized an income tax benefit of US$69,914 for the six months ended June 30, 2026 due to a loss.
Net (loss) income
Our net (loss) income decreased by approximately US$916,557, or 252.1% from a net income of approximately US$363,524 for the six months ended June 30, 2025 to net loss of approximately US$553,033 for the six months ended June 30, 2026, which was mainly due to the reasons discussed above.
Liquidity and Capital Resources
The following table sets forth our current assets and current liabilities as of the dates indicated:
| June 30, | December 31, | |||||||
| 2026 | 2025 | |||||||
| US$ | US$ | |||||||
| (unaudited) | ||||||||
| Current assets | ||||||||
| Cash | 6,606,369 | 7,420,426 | ||||||
| Accounts receivable, net | 99,908 | 32,411 | ||||||
| Other receivables and prepaid expenses | 294,772 | 108,215 | ||||||
| Amount due from related party | — | 79,946 | ||||||
| Total current assets | 7,001,049 | 7,640,998 | ||||||
| Current liabilities | ||||||||
| Account payable | — | 44,771 | ||||||
| Deferred revenue | — | 6,802 | ||||||
| Other payables and accrued liabilities | 13,234 | 11,007 | ||||||
| Lease liabilities – current | 89,414 | 80,412 | ||||||
| Taxes payable | 88,098 | 88,762 | ||||||
| Total current liabilities | 190,746 | 231,754 | ||||||
| Net current assets | 6,810,303 | 7,409,244 | ||||||
The Company’s primary sources of liquidity were IPO offerings and operating cashflow, and is expected to have more equity offering and continuing cash inflow from operations in the future. The Company does not foresee any factors that would potentially have a material impact on the Company’s liquidity.
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Accounts Receivable
Our accounts receivable balance increased by approximately US$67,497 from US$32,411 as of December 31, 2025 to approximately US$99,908 as of June 30, 2026. The accounts receivable balance of US$99,908 as of June 30, 2026 was collected in the third quarter of 2026.
Other receivables and prepaid expenses
Other receivables and prepaid expenses include rental deposits and advance payments made to vendors for certain services. The increase in other receivables and prepaid expenses by approximately US$186,557, or 172.4%, from approximately US$108,215 as of December 31, 2025 to approximately US$294,772 as of June 30, 2026 was mainly due to the increase in advance payments made to vendors.
Amount due from related party
Amount due from related party represented the revenue from providing consulting services to related party. Our amount due from related party decreased by approximately US$79,946, or 100.0%, from approximately US$79,946 as of December 31, 2025. The balance was fully settled during the first half year of 2026.
Accounts payable
Accounts payable mainly represented consulting services fees accrued as Starchain outsourced third-party companies to provide certain services for its corporate management consulting services. Our account payable decreased by approximately US$44,771, or 100.0%, from approximately US$44,771 as of December 31, 2025 to nil as of June 30, 2026. The balance was settled in order to maintain strong relationships and clear communication with suppliers, which supports structured payment plans and avoids disputes that prolong payables.
Deferred revenue
Deferred revenue represented advance payments received from customers before all of the relevant criteria for revenue recognition are met. These payments are non-refundable and are recognized as revenue when performance obligation is satisfied or upon contract expiry. Our deferred revenue decreased by approximately US$6,802 as of June 30, 2026, as compared to December 31, 2025. The decrease was primarily attributable to the recognition of revenue from customer advances as the related performance obligations were satisfied during the period, together with improved billing, collection, and customer-communication processes that reduced delays in customer payments and the accumulation of unapplied customer receipts.
Other payables and accrued liabilities
Our other payables and accrued liabilities mainly include accrued operating expenses and consideration payable in connection with the acquisition of 100% of equity interest in Shine Prosperity. Our other payables and accrued liabilities increased by approximately US$2,227, or 20.2%, from approximately US$11,007 as of December 31, 2025 to approximately US$13,234 as of June 30, 2026. The increase was mainly due to the accrual of compliance fee.
Taxes payable
Taxes payable represented income tax accrued by HF CM. Although HF CM was incorporated in BVI, its income may be recognized by the Hong Kong Inland Revenue Department as being subject to income tax as its operations and management are located in Hong Kong. We accrued this portion of income taxes based on taxable income in an amount of US$4,852 and US$7,920 as of June 30, 2026 and December 31, 2025, respectively. The movement of taxes payable for the six months ended June 30, 2026 at $664 was due from foreign exchange translation.
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Cash Flows
Comparison of Six Months ended June 30, 2026 and 2025
The following table sets forth a summary of our cash flows information for the years indicated:
| For
the six months ended June 30, |
||||||||
| 2026 | 2025 | |||||||
| US$ | US$ | |||||||
| (unaudited) | (unaudited) | |||||||
| Net cash (used in) operating activities | (779,129 | ) | (45,740 | ) | ||||
| Net cash (used in) investing activities | - | - | ||||||
| Net cash provided by financing activities | - | 1,251,732 | ||||||
| Net change in cash and cash equivalents | (814,057 | ) | 1,176,043 | |||||
| Cash at the beginning of year | 7,420,426 | 2,534,502 | ||||||
| Net foreign exchange differences | (34,928 | ) | (29,949 | ) | ||||
| Cash at the end of year | 6,606,369 | 3,710,545 | ||||||
There are no debt nor short-term obligations other than working capital.
Operating activities
Our cash inflow from operating activities was principally from the revenue from corporate management consulting services and asset management services, while our cash outflow used in operating activities principally consisted of payment of staff costs and employee benefits, rental and office expenses and other operating expenses.
Net cash generated from or used in operating activities reflects our net profit (loss) adjusted for (i) Depreciation charge of our property and equipment; (ii) Gain (loss) on Short-term investment; and (iii) the effects of changes in operating assets and liabilities, which mainly comprised our accounts receivables, other receivables and prepaid expenses, deferred tax assets, accounts payable, other payable and accrued liabilities, deferred revenue and taxes payable.
For the six months ended June 30, 2025, our net cash used in operating activities was approximately US$45,740, comprising (i) a net income of US$363,524 adjusted for non-cash depreciation of US$3,975; (ii) net changes in the operating assets and liabilities, primarily comprising of (a) an increase in accounts receivable of US$111,362; (b) a decrease in other receivables and prepaid expenses of US$131,459; (c) decrease in deferred tax assets of US$87,846; (d) a decrease in accounts payable of US$65,314; (e) a decrease in other payable and accrued liabilities of US$141,499; (f) a decrease in deferred revenue of US$326,183; and (g) an increase in taxes payable of US$11,814.
For the six months ended June 30, 2026, our net cash used in operating activities was approximately US$779,129, comprising (i) a net loss of US$553,033 adjusted for non-cash depreciation of US$4,109, amortization of ROU of US$38,800, increase in share issuance recognized as research and development expenses of US$845,780 and reversal of research and development expenses due to unvested restricted shares forfeited of US$788,915; (ii) net changes in the operating assets and liabilities, primarily comprising of (a) an increase in accounts receivable of US$67,497; (b) a decrease in accounts receivables from related parties of US$79,946; (c) an increase in other receivables and prepaid expenses of US$186,557; (d) an increase in deferred tax assets of US$68,264; (e) a decrease in accounts payable of US$44,771; (f) an increase in other payable and accrued liabilities of US$2,227; (g) a decrease in deferred revenue of US$6,802; and (h) a decrease in lease liabilities of US$34,152.
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Investing activities
Our cash generated from investing activities represented the loan to third parties and subsequent settlement.
For the six months ended June 30, 2025, there were no cash generated from investing activities.
For the six months ended June 30, 2026, our cash generated from investing activities was $0, consisting of US$6,320,000 loan to third party, as well as repayment of US$6,320,000 from third party.
Financing activities
For the six months ended June 30, 2025, our cash generated from financing activities was approximately US$1,251,732, consisting of (i) proceeds from issuance of ordinary shares of approximately US$3,000,000; (ii) repayment of loans to HF Holdings of US$1,362,951; and (iii) payment of deferred offering costs of approximately US$385,317.
For the six months ended June 30, 2026, there was no cash generated from financing activities.
Research and Development, Patents and Licenses, etc.
Further to the disclosure under item 4. Information on the Company-B. Business Overview-Intellectual Property.” in the Company’s annual report on Form 20-F for the fiscal year ended December 31, 2025, as of the date of this report, the Company has registered three trademarks application with the Intellectual Property Department of Hong Kong, all of which are related to the Company’s name.
Trend Information
Other than as disclosed in this Current Report on Form 6-K and its exhibits, we are not aware of any trends, uncertainties, demands, commitments or events for the current year that are reasonably likely to have a material effect on our net revenues, income, profitability, liquidity or capital reserves, or that caused the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
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Critical Accounting Estimates
We prepare our unaudited condensed consolidated financial statements in accordance with U.S. GAAP, which requires our management to make estimates that affect the reported amounts of assets, liabilities and disclosures of contingent assets and liabilities at the balance sheet dates, as well as the reported amounts of revenues and expenses during the reporting periods. To the extent that there are material differences between these estimates and actual results, our financial condition or results of operations would be affected. We base our estimates on our own historical experience and other assumptions that we believe are reasonable after taking account of our circumstances and expectations for the future based on available information. We evaluate these estimates on an ongoing basis.
Our expectations regarding the future are based on available information and assumptions that we believe to be reasonable, which together form our basis for making judgments about matters that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, our actual results could differ from those estimates. Some of our accounting policies require a higher degree of judgment than others in their application.
We consider an accounting estimate to be critical if: (i) the accounting estimate requires us to make assumptions about matters that were highly uncertain at the time the accounting estimate was made, and (ii) changes in the estimate that are reasonably likely to occur from period to period or use of different estimates that we reasonably could have used in the current period, would have a material impact on our financial condition or results of operations. When reading our unaudited condensed consolidated financial statements, you should consider our selection of critical accounting policies, the judgment and other uncertainties affecting the application of such policies and the sensitivity of reported results to changes in conditions and assumptions.
When reading our unaudited condensed consolidated financial statements, you should consider our selection of critical accounting policies, the judgment and other uncertainties affecting the application of such policies and the sensitivity of reported results to changes in conditions and assumptions.
While management believes its judgments, estimates and assumptions are reasonable, they are based on information presently available and actual results may differ significantly from those estimates under different assumptions and conditions. We believe that the following critical accounting estimates involve the most significant judgments used in the preparation of our financial statements.
Our significant accounting policies are described in Note 2 to our unaudited condensed consolidated financial statements included in this Form 6-K. Among these policies, certain accounting policies and estimates are considered particularly critical to the understanding of our financial condition and results of operations. These policies require management to make judgments, assumptions, and estimates that involve a higher degree of subjectivity and complexity, and that are more likely to materially affect the reported amounts of assets, liabilities, revenues, and expenses.
The management has evaluated its significant accounting policies and estimates and has concluded that none of the estimates used in the preparation of our unaudited condensed consolidated financial statements meet the definition of a critical accounting estimate.
Other than as disclosed elsewhere in this Form 6-K, we are not aware of any trends, uncertainties, demands, commitments, or events that are reasonably likely to have a material effect on our net revenue, income from continuing operations, profitability, liquidity, or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial condition.
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