☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Lawrence Venick, Esq.
Loeb & Loeb LLP
2206-19 Jardine House
1 Connaught Place, Central
Hong Kong SAR
Tel: +852.3923.1111
Fax: +852.3923.1100

Indicate by checkmark whether the issuer: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filed, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No No☒ ☒

Applicable Only to Issuer Involved in Bankruptcy Proceedings During the Preceding Five Years:

Indicate by checkmark whether the issuer has filed all documents and reports required to be filed by Section 12, 13 and 15(d) of the Securities Exchange Act of 1934 after the distribution of securities under a plan confirmed by a court. Yes ☐ No ☐

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the most practicable date:

	February 28, 2023			August 31, 2022			‎February 29, 2024			August 31, 2023
	(Unaudited)			(Audited)				(Unaudited)			(Audited)
ASSETS
Current assets
Cash and cash equivalents	$	242,755		$	152,304		$	137,029		$	779,049
Accounts receivable		40,554			85,960			42,686			44,130
Inventories		572,875			618,996			725,316			630,478
Deposit, prepayments and other receivables		649,059			831,666			489,408			617,507
Total current assets		1,505,243			1,688,926			1,394,439			2,071,164

Non-current assets
Property, plant and equipment, net		539,681			602,755			422,467			463,387
Operating lease right-of-use assets		323,904			442,020			229,972			271,021
Technology-related intangible assets, net		78,297,481			80,376,175			74,140,092			76,218,786
Total non-current assets		79,161,066			81,420,950			74,792,531			76,953,194

TOTAL ASSETS	$	80,666,309		$	83,109,876		$	76,186,970		$	79,024,358

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable and accruals	$	111,578		$	216,830		$	252,741		$	170,888
Income tax payable		225			-
Other payables		21,084			31,980			27,439			27,487
Deferred revenue		456,102			513,072			399,773			440,069
Hire purchase creditor		3,919			10,135			7,412			9,224
Amounts due to shareholders		314,165			2,301			439,630			232,095
Operating lease liability - current		87,983			117,686			88,952			84,879
Total current liabilities		995,056			892,004			1,215,947			964,642

Non-current liabilities
Non-current hire purchase creditor		20,058			18,207			8,199			10,531
Non-current operating lease liabilities		251,253			355,186			150,962			198,163
Total non-current liabilities		271,311			373,393			159,161			208,694

TOTAL LIABILITIES		1,266,367			1,265,397			1,375,108			1,173,336

Commitments and contingencies (Note 14)		-			-			-			-

Shareholders’ equity
Common stock, 1,000,000,000 authorized; $0.001 par value, 102,003,018 and 101,853,397 shares issued and outstanding as at February 28, 2023 and August 31, 2022		102,004			101,854
Common stock, 1,000,000,000 authorized; $0.001 par value, 102,742,362 and 102,310,933 shares issued and outstanding as at February 29, 2024 and August 31, 2023								102,742			102,311
Additional paid in capital		89,499,877			89,125,872			91,436,762			90,371,141
Shares to be issued		144,443			75,000			-			1,066,052
Accumulated other comprehensive income		55,874			65,880
Accumulated other comprehensive loss								(95,951	)		(17,036	)
Accumulated deficit		(10,214,862	)		(7,465,373	)		(16,334,493	)		(13,523,266	)
Non-controlling interest		(187,394	)		(58,754	)		(297,198	)		(148,180	)
Total shareholders’ equity		79,399,942			81,844,479			74,811,862			77,851,022

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	80,666,309		$	83,109,876		$	76,186,970		$	79,024,358

The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

FOR THE THREE AND SIX MONTHS ENDED FEBRUARY 29, 2024 AND FEBRUARY 28, 2023 ~~AND 2022~~

	February 28, 2023			February 28, 2022			February 28, 2023			February 28, 2022			‎February 29, 2024			‎February 28, 2023			‎February 29, 2024			‎February 28, 2023
	Three months ended						Six months ended						Three months ended						Six months ended
	February 28, 2023			February 28, 2022			February 28, 2023			February 28, 2022			‎February 29, 2024			‎February 28, 2023			‎February 29, 2024			‎February 28, 2023

Revenue	$	70,912		$	302,884		$	213,597		$	1,111,763		$	41,174			70,912		$	132,492		$	213,597
Cost of revenue		88,940			194,585			251,798			901,999			87,075			88,940			187,401			251,798
Gross (loss)/profit		(18,028	)		108,299			(38,201	)		209,764
Gross loss														(45,901	)		(18,028	)		(54,909	)		(38,201	)

Operating expenses:
Selling and marketing expenses		8,770			12,333			12,335			24,402			5,200			8,770			38,203			12,335
General and administrative expenses		1,418,011			1,290,746			2,841,393			1,788,734			1,468,559			1,418,011			2,952,548			2,841,393
Total operating expenses		1,426,781			1,303,079			2,853,728			1,813,136			1,473,759			1,426,781			2,990,751			2,853,728

Loss from operation		(1,444,809	)		(1,194,780	)		(2,891,929	)		(1,603,372	)		(1,519,660	)		(1,444,809	)		(3,045,660	)		(2,891,929	)

Other income/(expense)
Interest income/(expense)		12			(1,005,645	)		6			(1,005,645	)
Other income		7,500			12,027			14,483			37,287
Total other income/(expense)		7,512			(993,618	)		14,489			(968,358	)
Interest income														36			12			76			6
Other income														88,866			7,500			90,505			14,483
Total other income														88,902			7,512			90,581			14,489

Loss from operation before income taxes		(1,437,297	)		(2,188,398	)		(2,877,440	)		(2,571,730	)		(1,430,758	)		(1,437,297	)		(2,955,079	)		(2,877,440	)

Income tax credit		219			-			-			-
Income tax expenses														-			(219	)		-			-

Net loss	$	(1,437,078	)	$	(2,188,398	)	$	(2,877,440	)	$	(2,571,730	)	$	(1,430,758	)	$	(1,437,078	)	$	(2,955,079	)	$	(2,877,440	)

Less: Net loss attributable to non-controlling interests		(60,916	)		(83,549	)		(127,951	)		(191,673	)		(63,854	)		(60,916	)		(143,852	)		(127,951	)

Net loss attributable to equity holders of the Company		(1,376,162	)		(2,104,849	)		(2,749,489	)		(2,380,057	)		(1,366,904	)		(1,376,162	)		(2,811,227	)		(2,749,489	)

Other comprehensive income/(loss):
Other comprehensive income:
Foreign currency translation adjustment		7,212			11,651			(10,695	)		199,254			3,920			7,212			(84,081	)		(10,695	)
Total comprehensive loss		(1,368,950	)		(2,093,198	)		(2,760,184	)		(2,180,803	)		(1,362,984	)		(1,368,950	)		(2,895,308	)		(2,760,184	)

Less: net comprehensive income/(loss) attributable to non-controlling interests		3,495			5,185			(689	)		24,198
Less: net comprehensive income attributable to non-controlling interests														(2,373	)		3,495			(5,166	)		(689	)

Net comprehensive loss attributable to equity holders of the Company		(1,372,445	)		(2,098,383	)		(2,759,495	)		(2,205,001	)		(1,360,611	)		(1,372,445	)		(2,890,142	)		(2,759,495	)

Net loss attributable to equity holders of the Company per common share:
Basic and diluted		(0.01	)		(0.05	)		(0.03	)		(0.11	)		(0.01	)		(0.01	)		(0.03	)		(0.03	)

Weighted average number of common shares outstanding:
Basic and diluted		102,003,018			41,437,329			101,957,553			21,884,875			102,742,362			102,003,018			102,684,781			101,957,553

The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

FOR THE THREE AND SIX MONTHS ENDED FEBRUARY ~~28, 2023~~29, 2024 AND ~~2022~~

~~The accompanying footnotes are an integral part of these condensed consolidated financial statements.~~

~~UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (DEFICIT)~~

																						Common Stock				Additional paid in		Accumulated			Accumulated other comprehensive			Shares to be			Non-controlling
	Common Stock				Additional paid in		Accumulated			Accumulated other comprehensive			Shares to be			Non- controlling						shares		amount		capital		deficit			income			issued			interests			Total
	shares		amount		capital		deficit			income			issued			interests			Total

Balance as of August 31, 2022		101,853,397	$	101,854	$	89,125,872	$	(7,465,373	)	$	65,880		$	75,000		$	(58,754	)	$	81,844,479
Capital contribution		-		-		100		-			-			-			-			100
Issuance of common stock pursuant to capital raising		149,621		150		373,905		-			-			(75,000	)		-			299,055
Balance as of August 31, 2023																							102,310,933	$	102,311	$	90,371,141	$	(13,523,266	)	$	(17,036	)	$	1,066,052		$	(148,180	)	$	77,851,022
Issuance of common stock for Cash																							431,429		431		1,065,621		-			-			(1,066,052	)		-			-
Foreign currency translation adjustment		-		-		-		-			(13,723	)		-			(4,184	)		(17,907	)		-		-		-		-			(85,208	)		-			(2,793	)		(88,001	)
Net loss		-		-		-		(1,373,327	)		-			-			(67,035	)		(1,440,362	)		-		-		-		(1,444,323	)		-			-			(79,998	)		(1,524,321	)
Balance as of November 30, 2022		102,003,018	$	102,004	$	89,499,877	$	(8,838,700	)	$	52,157		$	-		$	(129,973	)	$	80,685,365
Balance as of November 30, 2023																							102,742,362	$	102,742	$	91,436,762	$	(14,967,589	)	$	(102,244	)	$	-		$	(230,971	)	$	76,238,700
Balance		102,003,018	$	102,004	$	89,499,877	$	(8,838,700	)	$	52,157		$	-		$	(129,973	)	$	80,685,365			102,742,362	$	102,742	$	91,436,762	$	(14,967,589	)	$	(102,244	)	$	-		$	(230,971	)	$	76,238,700
Foreign currency translation adjustment		-		-		-		-			3,717			-			3,495			7,212			-		-		-		-			6,293			-			(2,373	)		3,920
Issuance of common stock pursuant to share subscription agreement		-		-		-		-			-			144,443			-			144,443
Net loss		-		-		-		(1,376,162	)					-			(60,916	)		(1,437,078	)		-		-		-		(1,366,904	)		-			-			(63,854	)		(1,430,758	)
Balance as of February 28, 2023		102,003,018	$	102,004	$	89,499,877	$	(10,214,862	)	$	55,874		$	144,443		$	(187,394	)	$	79,399,942
Balance as of February 29, 2024																							102,742,362	$	102,742	$	91,436,762	$	(16,334,493	)	$	(95,951	)	$	-		$	(297,198	)	$	74,811,862
Balance		102,003,018	$	102,004	$	89,499,877	$	(10,214,862	)	$	55,874		$	144,443		$	(187,394	)	$	79,399,942			102,742,362	$	102,742	$	91,436,762	$	(16,334,493	)	$	(95,951	)	$	-		$	(297,198	)	$	74,811,862

The accompanying footnotes are an integral part of these unaudited condensed consolidated financial statements.

FOR THE SIX MONTHS ENDED FEBRUARY 29, 2024 AND FEBRUARY 28, 2023 ~~AND 2022~~

	February 28, 2023			February 28, 2022			‎February 29, 2024			‎February 28, 2023

Cash flows from operating activities
Net loss	$	(2,877,440	)		(2,571,730	)	$	(2,955,079	)		(2,877,440	)
Adjustments for non-cash income and expenses:
Depreciation		74,828			18,375			137,106			74,828
Amortization		2,078,694			692,898			2,078,694			2,078,694
Changes in operating assets and liabilities:
Beneficial conversion feature of convertible bonds		-			1,005,645
Decrease in accounts receivable		45,406			96,277
Decrease/(Increase) in inventories		46,121			(335,183	)
Decrease in deposit, prepayments and other receivables		182,607			116,416
Decrease in accounts receivables								1,444			45,406
(Increase)/decrease in inventories								(94,838	)		46,121
Decrease in deposit, prepayments and advances to suppliers								128,099			182,607
Decrease in operating lease right-of-use assets		118,116			-			41,049			118,116
Decrease in accounts payable and accruals		(105,027	)		(520,255	)
(Decrease)/Increase in deferred revenue		(56,970	)		23,460
Increase/(decrease) in accounts payable and accruals								81,853			(105,027	)
Decrease in deferred revenue								(40,296	)		(56,970	)
Decrease in operating lease liabilities		(133,636	)		-			(43,128	)		(133,636	)
(Decrease)/Increase in other payables		(10,896	)		622,868
Increase /(Decrease) in amounts due to shareholders		311,864			(30,277	)
Net cash used in operating activities	$	(326,333	)	$	(881,506	)
Decrease in other payables								(48	)		(10,896	)
Increase in amounts due to shareholders								207,535			311,864

Net cash used in operations							$	(457,609	)	$	(326,333	)

Cash flows from investing activity
Purchase of property, plant and equipment		(11,754	)		(524,148	)		(96,186	)		(11,754	)
Cash used in investing activity	$	(11,754	)	$	(524,148	)	$	(96,186	)	$	(11,754	)

Cash flows from financing activities
Payments of hire purchase		(4,365	)		-			(4,144	)		(4,365	)
Proceeds from issuance of common stock		299,055			-			-			299,055
Proceeds from shares to be issued		144,443			-			-			144,443
Proceeds from capital contribution		100			-			-			100
Net cash generated from financing activities	$	439,233		$	-
Net cash (used in)/generated from financing activities							$	(4,144	)	$	439,233


Net increase/(decrease) in cash and cash equivalents		101,146			(1,405,654	)
Net (decrease)/increase in cash and cash equivalents								(557,939	)		101,146
Effect of exchange rate changes		(10,695	)		199,254			(84,081	)		(10,695	)
Cash and cash equivalents at start of year		152,304			1,714,890
Cash and cash equivalents at end of year		242,755			508,490

Supplemental disclosure of non-cash investing and financing information :
Common stock issued for technology-related intangible assets	$	-		$	83,147,767
Common stock issued for convertible bonds	$	-		$	1,007,999
Right-of-use assets obtained in exchange for operating lease obligations	$	-		$	525,381
Cash and cash equivalents at start of period								779,049			152,304
Cash and cash equivalents at end of period								137,029			242,755

The accompanying footnotes are an integral part of these condensed consolidated financial statements.

FOR THE THREE AND SIX MONTHS ENDED FEBRUARY 29, 2024 AND FEBRUARY 28, 2023 ~~AND 2022~~

EvoAir Holdings Inc. (formerly Unex Holdings Inc.) (the “Company”, “EVOH”, “we”, “us”, or “our”) is a corporation established under the corporation laws in the State of Nevada, United States of America (“U.S”) on February 17, 2017. The Company has adopted an August 31 fiscal year end.

On December 20, 2021, the Company and Low Wai Koon (“Dr. Low”) entered into a share transfer agreement, (the “EvoAir International Share Transfer Agreement”), pursuant to which Dr. Low agreed to sell all of his ordinary shares of EvoAir International Limited (“EvoAir International”) to the Company for a consideration of US$100 (“EvoAir Transaction”). EvoAir International, through its subsidiaries upon completion of the Transactions (defined hereunder), is engaged in the research and development (“R&D”), manufacturing, trading, sale of heating, ventilation and air conditioning (“HVAC”) products and related services in Asia.

Pursuant to the terms of a share transfer agreement dated December 20, 2021, Dr. Low, the then sole executive officer and director of the Company and the owner of 2,000,000 restricted shares of common stock, with par vaue of $0.001 per share (“Common Stock”) of the ~~Company’s ordinary shares~~Company (“EvoAir Shares”) representing approximately 67.34% of the Company’s then issued and outstanding shares, sold his entire shareholding of the Company to WKL Global Limited (“WKL Global”) for an aggregate consideration of $100 (“Change of Control Transaction”). Upon completion of the Change of Control Transaction, WKL Global owned2,000,000 shares, or approximately67.34% of the then issued and outstanding ordinary shares of the Company, which resulted in a change of control of the Company.

On December 20, 2021, several transactions took place (together, the “Allotment Transactions”) whereby the Company issued and allotted in aggregate 98,809,323 ordinary shares of common stock to certain parties. On completion of the Allotment Transactions, the total number of issued and outstanding shares of common stock of the Company were 101,779,323 (“(“Then Enlarged Share Capital”):

EvoAir Transaction, Change of Control Transaction and Allotment Transactions are collectively ~~to be~~ referred to as the “Transactions”. The closing of the Transactions ~~(the “Closing”~~(“Closing”) occurred on December 20, 2021 (the “Closing Date”).

From and after the Closing Date, at which time EvoAir International transferred its HVAC business to the Company, the Company’s primary operations will consist of the prior operations of EvoAir International and its subsidiaries.

EvoAir International is a company incorporated in ~~the British Virgin Islands (“BVI”)~~BVI on November 17, 2021. Effective from the December 20, 2021, it wholly owns WKL Eco Earth Holdings, a company incorporated in Singapore on July 12, 2018, which in turn wholly owns (a) WKL Eco Earth, a Malaysian company incorporated on May 17, 2017, and (b) WKL Green Energy, a Malaysian company incorporated on October 24, 2017. WKL Eco Earth Holdings acquired (c) EvoAir Manufacturing (M) Sdn Bhd (“EvoAir Manufacturing”) on April 19, 2021, a Malaysian company incorporated on March 22, 2019, as well as acquiring (d) WKL EcoEarth Indochina Co Ltd (“WKL EcoEarth Indochina”), a Cambodia company incorporated on February 4, 2021, (e) WKL Guanzhe Green Technology Guangzhou Co Ltd (“WKL Guanzhe”), a Chinese company incorporated on April 6, 2021. EvoAir Manufacturing wholly owns (f) Evo Air Marketing (M) Sdn Bhd (“Evo Air Marketing”), a Malaysian company incorporated on February 2, 2021.

On June 15, 2022, the Company filed a Certificate of Amendment (the “Amendment”) to the Articles of Incorporation with Nevada’s Secretary of State to change the name of the Company from Unex Holdings Inc. to EvoAir Holdings Inc. (the “Name Change”), and the Name Change became market effective on November 4, 2022. Effective on November 11, 2022, the Company’s shares began trading under the new ticker symbol “EVOH”.

The Company entered into a series of offerings for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50, as follows:

Pursuant to the terms of a share transfer agreement dated December 20, 2021, Dr. Low, the then sole executive officer and director of the Company and the owner of 2,000,000 restricted shares of the Company’s ordinary shares representing approximately 67.34% of the ~~Enlarged Share Capital,~~Company’s then issued and outstanding shares, sold his entire shareholding of the Company to WKL Global for an aggregate consideration of $100. Upon completion of the Change of Control Transaction, WKL Global ~~Limited~~ then owned 2,000,000 shares, or approximately 67.34% of ~~Enlarged Share Capital,~~the Company’s then issued and outstanding shares, which resulted in a change of control of the Company.

The Company’s financial statements as of February ~~28, 2023,~~29, 2024, is prepared using generally accepted accounting principles in the ~~U.S.~~United States of America (“U.S. GAAP”) applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established a sustainable ongoing source of revenue sufficient to cover its operating costs and allow it to continue as a going concern.

As of February ~~28, 2023~~29, 2024, and August 31, ~~2022,~~ 2023, the Company had an accumulated deficit of $~~10,214,862~~ 16,334,493and $~~7,465,373~~13,523,266 respectively. The Company incurred net loss of $~~2,877,440~~ 2,955,079and $ $~~2,571,730~~2,877,440 for the six months ended February ~~28, 2023~~29, 2024, and February 28, ~~2022,~~2023, respectively. The cash used in operating activities ~~were~~was $~~326,333~~457,609 and $~~881,506~~326,333 for the six months ended February ~~28, 2023~~29, 2024, and February 28, ~~2022,~~2023, respectively. It was brought to the attention of the Management to assess going concern considering all facts and circumstances about the foreseeable future of the Company as well as its assets and liabilities on the basis that it will be able to realize and discharge them in the normal course of business.

With the ~~injection~~development of ~~a viable~~HVAC business ~~into the Company~~ (“HVAC Business”) ~~contemplated under~~pursuant to the Transactions (defined in Note 1)1), the Management believes that the actions to be taken by the Management to further implement the business plans for the HVAC Business including expansion in product offerings, geographical expansion, generate revenue through expansion of revenue streams and customer base (retail, commercial, industrial, projects as well as private label and licensing clientele), improvement of profitability by achieving economies of scale provide the opportunity for the Company to continue as a going concern. In addition, the Company is also working on raising additional funding in conjunction with the Company’s plan to uplist on Nasdaq Capital Market/ NYSE American LLC to finance the operations as well as business expansion.

The unaudited condensed consolidated ~~financial statements~~financials have been prepared assuming that the Company will continue as a going concern and accordingly financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Basis of ~~Presentation~~presentation and ~~Principles~~principles of ~~Consolidation~~consolidation:

The accompanying unaudited condensed consolidated financial statements have been prepared by the ~~Group~~Company in accordance with U.S. GAAP for financial information and pursuant to the applicable rules and regulations of the Securities and Exchange Commission (“SEC”).

The ~~unaudited condensed~~ consolidated financial statements include the accounts of EvoAir International, WKL Eco Earth Holdings, ~~and its subsidiaries namely (i)~~ ~~100% owned~~ WKL Eco Earth, ~~(ii)~~ ~~100% owned~~ WKL Green Energy, ~~(iii)~~and its 67.5% owned EvoAir Manufacturing ~~(which includes its wholly~~which included a 100% owned subsidiary, Evo Air ~~Marketing), (iv)~~Marketing, 55% owned WKL EcoEarth Indochina, and ~~(v)~~its 55% owned WKL Guanzhe.

As WKL Eco Earth and WKL Green Energy were under common control at the time of the Transactions, it is required under U.S. GAAP to account for this common control acquisition in a manner similar to the pooling of interest method of accounting. Under this method of accounting, EVOH’s condensed consolidated balance sheets as of February 28, 2023 and August 31, 2022, reflect WKL Eco Earth and WKL Green Energy on a historical carryover basis in the assets and liabilities instead of reflecting the fair market value of the assets and liabilities.

All intercompany accounts and transactions have been eliminated onin consolidation. In the opinion of the Management, the accompanying financial statements contain all adjustments (consisting of normal and recurring accruals) necessary to present fairly all financial statements in accordance with U.S. GAAP.

The non-controlling interests are presented in the ~~unaudited condensed~~ consolidated balance sheets, separately from equity attributable to the ~~shareholders~~stockholders of the Company. Non-controlling interests in the results of the Company are presented on the face of the ~~condensed~~ consolidated statements of operations and comprehensive loss as an allocation of the total loss for the year between non-controlling interest holders and the ~~shareholders~~stockholders of the Company.

The preparation of financial statements in conformity with U.S. GAAP requires ~~the Management~~management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expenses during the reporting periods. Key estimates in the accompanying ~~unaudited condensed~~ consolidated financial statements include, ~~inter-alia~~,among others, revenue recognition, allowances for doubtful accounts and product returns, provisions for obsolete inventory, valuation of long-lived assets and ~~rights~~Rights of ~~use~~Use (“ROU”) assets (including lease liabilities), and deferred income tax asset valuation allowances. Actual results could differ materially from these estimates.

The Company operates on a fiscal year basis with the fiscal year ending on August 31.

The Company considers all highly liquid investments with a maturity of three months or less to be cash equivalents. The Company places its cash with a high credit quality financial ~~institutions.~~institution.

WKL ~~Guanzhe’s~~Guanzhe business is primarily conducted in China and substantially all of ~~its~~ revenue isare denominated in ~~Chinese Renminbi (“RMB”).~~RMB. The government of People’s Republic of China (“PRC”) imposes control over its foreign currency reserves in part through direct regulation of the conversion of RMB into foreign exchange and through restrictions on foreign trade.

ASC 220 “Comprehensive Income,” establishes standards for the reporting and display of comprehensive income and its components in the financial statements. As of February ~~28,~~29, 2024, and August 31, 2023, ~~and February 28, 2022,~~ the Company established that there are items that represented components of comprehensive income and, therefore, has included a statement of comprehensive ~~income/loss~~income in the financial statements.

The functional currency of Chinese operations is ~~RMB.~~Chinese Renminbi, (“RMB”). The functional currency of the Company’s Singapore operations is Singapore dollars (“SGD”). The functional currency of the Company’s Malaysia operations is Ringgit Malaysia (“RM”). ~~The~~ Management has adopted ASC 830 “Foreign Currency Matters” for transactions that occur in foreign currencies. Monetary assets denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Average monthly rates are used to translate ~~revenue~~revenues and expenses.

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing onat the dates of the transaction. Exchange gains or losses arising from foreign currency transactions are included in the determination of net income for the respective periods.

Assets and liabilities of the Company’s operations are translated into the reporting currency, United States Dollars, ~~(“US$”),~~ at the exchange rate in effect at the balance sheet dates. Revenue and expenses are translated at average rates in effect during the reporting periods. Equity transactions are recorded at the historical rate when the transaction occurred. The resulting translation adjustment is reflected as accumulated other comprehensive ~~income/loss,~~income, a separate component of ~~shareholders’~~stockholders’ equity in the statement of ~~changes in equity/deficit.~~stockholders’ equity.

Accounts receivable are recorded at the net value of face amount less any allowance for doubtful accounts. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in our existing accounts receivable. An allowance for doubtful accounts is recorded in the period when loss is probable based on an assessment of specific evidence indicating troubled collection, historical experience, accounts aging and other factors. The Company reviews the allowance for doubtful accounts on a regular basis, and all past due balances are reviewed individually for collectability. An account receivable is written off after all collection effort has ceased. Recoveries of receivables previously written off are recorded when received. Interest is not charged on past due accounts.

As of February ~~28, 2023,~~29, 2024, and August 31, ~~2022,~~2023, our accounts receivable amounted to $~~40,554~~42,686 and $~~85,960~~44,130, respectively, with no allowance for doubtful accounts for both periods.

Inventories consist primarily of finished goods, raw materials, and work-in-process (“WIP”) from WKL Eco Earth, WKL EcoEarth Indochina, WKL Guanzhe, and EvoAir Manufacturing.

We value inventories at the lower of cost or net realizable value. We determine the costs of inventory using the standard cost method, which approximates actual cost based on a first-in, first-out method. All other costs, including administrative costs, are expensed as incurred.

Deposit, ~~Prepayments~~prepayments, and ~~Other Receivables~~other receivables

Deposit, prepayments and other receivables are comprised of prepayments paid to vendors to initiate orders and prepaid services fees and are classified as current assets if such amounts are to be recognized within one year from the balance sheet date.

Property, plant and equipment are recorded at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related capitalized assets. Property ~~plant~~ and equipment are depreciated over 5 to 10 ~~years~~years..

Repair and maintenance costs are charged to expense as incurred. At the time of retirement or other disposition of property, plant and equipment, the cost and accumulated depreciation will be removed from the accounts and the resulting gain or loss, if any, will be reflected in operations.

The Company’s intangible assets consist of patents ~~trademarks as well as patent~~ and ~~trademark applications~~trademarks related to assignments of intellectual properties by Dr. Low into WKL Eco Earth Holdings under the IP Assignments as contemplated in Note 1. The intangible assets are recorded at fair market value and are amortized using the straight-line method over an estimated life of 20 years for both patents and trademarks.

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to future undiscounted cash flows the assets are expected to generate. If identifiable intangibles are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds its fair market value.

Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The Company does not disaggregate its revenue streams as the economic factors underlying the contracts are similar and provide no significant distinction. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as ~~revenue~~revenues the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied.

The Company collects deposits from customers in advance for some business contracts. The customer payments received in advance are recorded as deferred revenue on the balance sheet. The deferred revenue of $440,069 was recorded as of August 31, 2023, with $101,496 recognized as revenue for six months ended February 29, 2024. The Company ~~recognized~~recorded $~~456,102, and $513,072~~399,773 deferred revenue as of February ~~28, 2023, and August 31, 2022, respectively.~~29, 2024.

We have entered into operating agreements primarily for office and factory. We determine if an arrangement is a lease at inception. For all classes of underlying assets, we elect not to recognize ~~ROU~~right of use assets or lease liabilities when a lease has a lease term of 12 months or less at the commencement date and does not include an option to purchase the underlying asset that we are reasonably certain to exercise. Operating lease assets and liabilities are included on our ~~unaudited condensed~~ consolidated balance sheet as of February ~~28, 2023, and August 31, 2022.~~29, 2024.

Operating lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value of the future lease payments is our incremental borrowing rate, because the interest rate implicit in most of our leases is not readily determinable. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in the economic environments where the leased asset is located. Operating lease assets also include any prepaid lease payments and lease incentives. Our lease terms include periods under options to extend or terminate the lease when it is reasonably certain that we will exercise that option. We generally use the base, non-cancellable, lease term when determining the lease assets and liabilities. Operating lease expense is recognized on a straight-line basis over the lease term.

Our lease agreements generally contain lease and non-lease components. Non-lease components primarily include payments for maintenance and utilities. We combine fixed payments for non-lease components with our lease payments and account for them together as a single lease component, which increases the amount of our lease assets and liabilities.

The Company utilizes ASC Topic 740, “Income Taxes,” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the ~~unaudited condensed~~ consolidated financial statements or tax returns. The Company accounts for income taxes using the asset and liability method to compute the differences between the tax basis of assets and liabilities and the related financial amounts, using currently enacted tax rates. A valuation allowance is recorded when it is “more likely-than-not” that a deferred tax asset will not be realized.

The Company’s practice is to recognize interest and penalties, if any, related to uncertain tax positions in income tax expense in the consolidated statements of operations.

The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined in the following three categories:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market-based inputs or inputs that are corroborated by market data.

The Company computes basic and diluted earnings (loss) per share amounts in accordance with ASC Topic 260, “Earnings per Share.” Basic earnings (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company. As of February ~~28, 2023,~~29, 2024, the Company has no potentially dilutive securities, such as options or warrants, currently issued and outstanding.

~~Except~~In August 2020, the FASB issued ASU 2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). This ASU reduces the number of accounting models for ~~rules~~convertible debt instruments and ~~interpretive releases~~convertible preferred stock and amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related earnings per share guidance. This standard becomes effective for the Company beginning on October 1, 2024. Adoption is either a modified retrospective method or a fully retrospective method of transition. The Company adopted this guidance effective September 1, 2023, and the adoption of this standard did not have a material impact on its consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, Improvement to Reportable Segment Disclosures. This ASU aims to improve segment disclosures through enhanced disclosures about significant segment expenses. The standard requires disclosure of significant expense categories and amounts for such expenses, including those segment expenses that are regularly provided to the chief operating decision maker, easily computable from information that is regularly provided, or significant expenses that are expressed in a form other than actual amounts. This standard will be effective for the Company in Fiscal Year 2025 and is required to be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of the ~~SEC under~~additional disclosure requirements on the ~~authority of federal securities laws and a limited number of grandfathered standards,~~Company’s condensed consolidated financial statements.

In December 2023, the FASB ~~Accounting Standards Codification™ (“ASC”)~~issued ASU 2023-09, Improvements to Income Tax Disclosures, a final standard on improvements to income tax disclosures which applies to all entities subject to income taxes. The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. This standard will be effective for the ~~sole source~~Company in Fiscal Year 2026 and should be applied prospectively. The Company is currently evaluating the impact of ~~authoritative GAAP literature recognized~~the additional disclosure requirements on the Company’s condensed consolidated financial statements.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified Public Accountants, and ~~applicable~~the Securities and Exchange Commission did not or are not believed by management to ~~the Company. Management has reviewed the aforementioned rules and releases and believes any effect will not~~ have a material impact on the Company’s present or future financial statements.

In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 adds a current expected credit loss (“CECL”) impairment model to U.S. GAAP that is based on expected losses rather than incurred losses. Modified retrospective adoption is required with any cumulative-effect adjustment recorded to retained earnings as of the beginning of the period of adoption. ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, including interim periods within the year of adoption. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company does not expect the application of the CECL impairment model to have a significant impact on its allowance for uncollectible amounts for accounts receivable.

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers. This ASU should be applied prospectively to acquisitions occurring on or after the effective date of December 15, 2022, and early adoption is permitted.

The Company has implemented all new applicable accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

	February 28, 2023		August 31, 2022		February 29, 2024		August 31, 2023

Deposits and prepayment		34,684		61,270
Deposits and Prepayments					$	47,132	$	20,777
Other receivables (Advances to suppliers)		614,375		770,396		442,276		596,730

Total		649,059		831,666	$	489,408	$	617,507

	February 28, 2023			August 31, 2022			February 29, 2024			August 31, 2023
Plant and machineries	$	475,830		$	464,019		$	577,079		$	476,219
Office equipment		56,110			55,587			55,907			55,848
Vehicles		71,664			71,860			75,776			77,497
Furniture and equipment		26,514			26,577			21,790			22,285
Renovation		133,988			134,309			110,788			113,305
Property plant and equipment gross		764,106			752,352
Property, plant and equipment gross								841,340			745,154
Less: Accumulated depreciation		(224,425	)		(149,597	)		(418,873	)		(281,767	)
Property, plant and equipment, net	$	539,681		$	602,755		$	422,467		$	463,387

Depreciation expense for the ~~year~~six months ended ~~August 31, 2022~~February 29, 2024, was $~~95,158~~137,106. Depreciation ~~expenses~~expense for the six months ended February 28, 2023, was $74,828.

The below table summarizes the identifiable intangible assets as of February ~~28, 2023~~29, 2024, and August 31, ~~2022:~~2023:

	February 28, 2023			August 31, 2022			February 29, 2024			August 31, 2023

Technology 1- Portable Air Cooler	$	27,438,763		$	27,438,763
Technology 2- Condensing Unit		55,709,004			55,709,004
Technology 1-Portable Air Cooler							$	27,438,763		$	27,438,763
Technology 2-Condensing Unit								55,709,004			55,709,004
Finite- lived intangible assets, gross		83,147,767			83,147,767			83,147,767			83,147,767
Less: Accumulated amortization		(4,850,286	)		(2,771,592	)		(9,007,675	)		(6,928,981	)
Intangible assets, net	$	78,297,481		$	80,376,175		$	74,140,092		$	76,218,786

Amortization ~~expense~~expenses for ~~the year ended August 31, 2022 was $2,771,592. Amortization expenses~~intangible assets for the six months ended February 29, 2024, and February 28, 2023, ~~was~~were both $2,078,694.

~~Account payables~~Accounts payable and accruals, and other payables consist of the following:

	February 28, 2023		August 31, 2022		February 29, 2024		August 31, 2023

Accounts payable	$	61,588	$	110,782	$	214,341	$	40,939
Accruals		49,990		106,048		38,400		129,949
Other payables		21,084		31,980		27,439		27,487
Total	$	132,662	$	248,810	$	280,180	$	198,375

Amounts due to shareholders are ~~non-interest bearing,~~ unsecured, ~~have no fixed repayment term,~~with interest of 3% per annum and ~~are not evidenced by any written agreement.~~tenure of 3 to 6 months, or mutually between the parties. The Company reported ~~amount~~amounts due to shareholders of $~~314,165~~439,630 and $~~2,301~~232,095 as of February ~~28, 2023~~29, 2024, and August 31, ~~2022,~~2023, respectively.

~~Eco Awareness Sdn Bhd is related to a common shareholder. Eco Awareness Sdn Bhd was our main distributor for E-cond~~^Life ~~product. Eco Awareness Sdn Bhd has been re-designated as distributor in October 2022.~~

~~The sales generated from Eco Awareness Sdn Bhd amounted to $Nil~~ ~~and $13,425~~ ~~during the six months ended February 28, 2023 and February 28, 2022, respectively. The accounts receivable from Eco Awareness Sdn Bhd amounted to $Nil~~ ~~as of both February 28, 2023 and August 31, 2022.~~

~~The purchases from Eco Awareness Sdn Bhd amounted to $Nil~~ ~~and $16,222~~ ~~during the six months ended February 28, 2023 and February 28, 2022, respectively. The accounts payable due to Eco Awareness Sdn Bhd amounted to $Nil~~ ~~as of both February 28, 2023, and August 31, 2022.~~

On December 16, 2021, the Company ~~has~~ increased the authorized common stock from 75,000,000 shares with a par value of $0.001 per share to 1,000,000,000 shares with a par value of $0.001 per share.

~~During the six months ended February 28, 2022, the Company issued~~ ~~1,116,055~~ ~~shares of common stock in connection with the conversion of $1,007,999~~ ~~in principal related to its convertible bonds.~~

~~During the six months ended February 28, 2022, the Company issued~~ ~~83,147,767~~ ~~shares of common stock in connection with Dr. Low’s two deeds of assignments of intellectual properties.~~

~~During the six months ended February 28, 2022, the Company issued~~ ~~14,443,501~~ ~~shares of common stock pursuant to investment exchange agreement with relevant interest holders in relation to capital raising undertaken by WKL Eco Earth Holdings in prior years.~~

~~During the six months period ended February 28, 2022, the Company issued~~ ~~30,000~~ ~~shares of common stock pursuant to share agreement with WKL Eco Earth Holdings for acquisition of WKL Green Energy and issued~~ ~~72,000~~ ~~shares of common stock pursuant to share exchange agreement for the acquisition of WKL Eco Earth.~~

During the six months period ended February 28, 2023, the Company issued 149,621 shares of common stock, par value $0.001 per share at a per share purchase price of $2.50 for gross proceeds of $374,055, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50.

During the six months period ended February 28, 2023, the Company also received cash proceeds of $144,443from 57,783shares to be issued, and those shares ~~were not~~have been subsequently issued ~~as of the report date.~~on May 26, 2023.

During the six months period ended February 28, 2023, the Company received cash proceeds of $100 from capital contribution.

During the six months period ended February 29, 2024, the Company issued 373,822 shares of Common Stock at a per share purchase price of $2.50 as the Offering for gross proceeds of $934,534 received in the fiscal year ended August 31,2023.

During the six months period ended February 29, 2024, the Company issued in aggregate 52,107 shares of Common Stock to 15 referral agents in consideration for their referral to the Company of certain investors.

On November 21, 2023, the Company issued, in aggregate, 5,500 shares of Common Stock to two individuals in consideration for marketing services provided to the Company by Artisan Creative Studio, a marketing entity based in Malaysia.

As of February ~~28,~~29, 2024, and August 31, 2023, ~~and February 28, 2022,~~ the Company had ~~102,003,018~~102,742,362 and ~~101,779,323~~102,310,933 shares of its common stock issued and outstanding, respectively.

The Company’s operating subsidiaries are governed by the Income Tax Law (defined hereunder), which ~~is concerning~~concerns Foreign Investment Enterprises and Foreign Enterprises and various local income tax laws (“~~the~~ Income Tax Laws”). We ~~are~~ routinely ~~undergoing~~undergo examinations in the jurisdictions in which we operate.

The Company has operations in Singapore, Malaysia, Cambodia, BVI, and China that are subject to taxes in the jurisdictions in which they operate, as follows:

WKL Eco Earth Holdings is incorporated in Singapore, and under the current tax laws of Singapore, its standard corporate income tax rate is 17%.

WKL Eco Earth, WKL Green Energy and ~~Evoair~~EvoAir Manufacturing (including its 100% subsidiary Evo Air Marketing) are incorporated in Malaysia and are subject to common corporate income tax rate at 24%.

WKL EcoEarth Indochina is incorporated in Cambodia, and under the current tax laws of Cambodia, its standard corporate tax rate is 20%.

EvoAir International is incorporated in BVI, and a BVI Business Company is exempt from the BVI income tax.

WKL Guanzhe is incorporated in China. Under the current tax law in the PRC, WKL Guanzhe is subject to the enterprise income tax rate of 25%.

Due to the Company’s net loss position, there was no provision for income taxes recorded. As a result of the Company’s losses to date, there exists doubt as to the ultimate realization of the deferred tax assets. Accordingly, a valuation allowance equal to the total deferred tax assets has been recorded.

Reconciliation between the statutory tax rate to income before income taxes and the actual provision for income taxes is as follows:

SCHEDULE OF RECONCILIATION BETWEEN THE STATUTORY TAX RATE AND THE ACTUAL PROVISION

	February 28, 2023			August 31, 2022			February 29, 2024			August 31, 2023
Net operating loss carry-forward	$	10,210,000		$	7,470,000		$	16,330,000		$	13,520,000
Less: valuation allowance		(10,210,000	)		(7,470,000	)		(16,330,000	)		(13,520,000	)
Net deferred tax asset		-			-			-			-

The Company had net operating loss carry forwards for tax purposes of approximately $~~10,210,000~~16,330,000 ~~as of~~at February ~~28, 2023~~29, 2024, and approximately $~~7,470,000~~13,520,000 ~~as of~~at August 31, ~~2022,~~2023, which may be available to offset future taxable income. Utilization of the net operating loss carry forwards may be subject to substantial annual limitations due to the ownership change limitations provided by Section 381 of the Internal Revenue Code of 1986, as amended. The annual limitation may result in the expiration of net operating loss carry forwards before utilization.

A lease is defined as a contract that conveys the right to control the use of identifiable tangible property for a period of time in exchange for consideration. On February 28, ~~2023,~~2022, the Company adopted ASC Topic 842 which primarily affected the accounting treatment for operating lease agreements in which the Company is the lessee including the Company’s leases of ~~offices~~office and ~~factories.~~factory. The Company elected to not recognize ROU assets and lease liabilities arising from short-term leases with initial lease terms of twelve months or less (deemed immaterial) on the accompanying consolidated balance sheets.

ROU assets include any prepaid lease payments and exclude any lease incentives and initial direct costs incurred. Lease expense for minimum lease payments is recognized on the effective interest, the effective amortization on the lease liability. The lease terms may include options to extend or terminate the lease if it is reasonably certain that the Company will exercise that option.

When measuring lease liabilities for leases that were classified as operating leases as of February ~~28, 2023 and August 31, 2022,~~29, 2024, the Company discounted lease payments using its estimated incremental borrowing rate of 10%.

On March 28, 2023, the Company entered into a lease termination agreement to its Cambodia office lease at #65, 1^st~~, 2~~^nd1st, 2nd and 3rd Floor, Street 123, Sangkat Toul Tumpong I, Khan Chamkarman, Phnom Penh, Cambodia (the “Lease Termination”). The Lease Termination terminated the Company’s rights and obligations with respect to the leased premises on April 15, 2023. As such, the ROU assets and operating lease liabilities were remeasured, and the Company recorded a gain of $14,890 as a component of operating expenses for the ~~three months~~year ended ~~February 28,~~August 31, 2023. No impairment of the ROU assets was deemed to have occurred.

The following is a summary of ROU ~~assets~~asset and operating lease liabilities:

	February 28, 2023		August 31, 2022		February 29, 2024		August 31, 2023
Assets:
ROU assets	$	323,904	$	442,020
ROU asset					$	229,972	$	271,021

Liabilities:
Current:
Operating lease liabilities	$	87,983	$	117,686
Non-current:
Operating lease liabilities		251,253		355,186
Operating lease liabilities current					$	88,952	$	84,879
Non-current
Operating lease liabilities noncurrent						150,962		198,163
Total lease liabilities	$	339,236	$	472,872	$	239,914	$	283,042

As of February ~~28, 2023,~~29, 2024, remaining maturities of lease liabilities were as follows:

	Operating lease		Operating lease
2023	$	87,983
2024		92,900		$88,952
2025		106,236		96,363
2026		47,905		50,616
2027 and thereafter		4,212
2027				3,983
2028 and thereafter				-
Total	$	339,236		$239,914

On October 8, 2021, a filing (the “Filing”) was made with the Kuala Lumpur High Court by a reseller (the “Reseller”) of the Company’s INCU ionic nano copper solution (the “Solution”) and the Reseller’s related party (together with the Reseller, the “Plaintiffs”).

The Reseller was authorized by WKL Eco Earth’s sole distributor of the Solution (the “WKL Distributor”) to resell the Solution together with a diffuser with a capacity of not more than 1000ml through a tripartite agreement (the “Tripartite Agreement”) entered into between (a) the Reseller, (b) the WKL Distributor and (c) a solution packaging company (the “Packaging Company”). WKL Eco Earth was not a party to the Tripartite Agreement and did not directly authorize or engage the Reseller in the resale of the Solution.

In the Filing, the Plaintiffs claimed against (i) WKL Eco Earth; (ii) Dr. Low; (iii) Chan Kok Wei, (iv) the Packaging Company and (v) two directors of the Packaging Company for loss and damages arising from an alleged breach of contract, defamation and tort of inducement. The Plaintiffs also alleged that pursuant to the Tripartite Agreement, WKL Eco Earth was prohibited from selling the Solution to any party other than the WKL Distributor and allow for the resale of the Solution by the Plaintiffs without limitation, and that the Plaintiffs were not confined in their resale of the Solution to a diffuser with a capacity of not more than 1000ml.

The Company believes the claims are without merit and will defend itself against the claims.

The Company follows subtopic 450-20 of the FASB Accounting Standards Codification to report accounting for contingencies. The outcome of the above case very much depends on the evidence produced and the weight of the Court places on the evidence. As it stands, WKL has a probability of success in its Counterclaim against the parties. Management does not believe, based upon information available at this time, that these matters will have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows.

In accordance with FASB ASC 855-10 Subsequent Events, the Company has analyzed its operations subsequent to February ~~28, 2023,~~29, 2024, to the date these ~~unaudited condensed~~ consolidated financial statements were issued, and has determined that it does not have any material subsequent events to disclose in these consolidated financial statements.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Quarterly Report contains forward-looking statements relating to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “intends”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential”, or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors which may cause our or our industry’s actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity or performance. You should not place undue reliance on these statements, which speak only as of the date that they were made. These cautionary statements should be considered with any written or oral forward-looking statements that we may issue in the future. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results, later events or circumstances or to reflect the occurrence of unanticipated events.

In this report unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common shares” or “common stock” refer to the common shares of our capital stock.

The management’s discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with U.S. GAAP.

EvoAir Holdings Inc (formerly Unex Holdings Inc.) (the “Company”, “EVOH”, “we”, “us”, or “our”) is a corporation established under the corporation laws in the State of Nevada, U.S. on February 17, 2017. The Company has adopted an August 31 fiscal year end.

On December 20, 2021, the Company and Dr. Low entered into the “EvoAir International Share Transfer Agreement, pursuant to which Dr. Low agreed to sell all of his ordinary shares of EvoAir International to the Company for the consideration of US$100 (“EvoAir Transaction”). EvoAir International, through its subsidiaries upon completion of the Transactions contemplated under Note 1, is engaged in the R&D, manufacturing, trading, sale of HVAC products and related services in Asia.

Pursuant to the terms of a share transfer agreement dated December 20, 2021, Dr. Low, the then sole executive officer and director of the Company and the owner of 2,000,000 restricted shares of the Company’s ordinary shares representing approximately 67.34% of the Company’s then issued and outstanding shares, sold his entire shareholding of the Company to WKL Global for an aggregate consideration of $100. Upon completion of the Change of Control Transaction, WKL Global owned 2,000,000 shares, or approximately 67.34% of the then issued and outstanding ordinary shares of the Company, which resulted in a change of control of the Company.

EvoAir International is a company incorporated in the British Virgin Islands on November 17, 2021. Effective from the December 20, 2021, it wholly owns WKL Eco Earth Holdings, a company incorporated in Singapore on July 12, 2018, which in turn wholly owns (a) WKL Eco Earth, a Malaysian company incorporated on May 17, 2017, and (b) WKL Green Energy a Malaysian company incorporated on October 24, 2017. WKL Eco Earth Holdings acquired (c) EvoAir Manufacturing on April 19, 2021, a Malaysian company incorporated on March 22, 2019, as well as acquiring (d) WKL EcoEarth Indochina, a Cambodia company incorporated on February 4, 2021, (e) WKL Guanzhe Green Technology Guangzhou, a Chinese company incorporated on April 6, 2021. EvoAir Manufacturing wholly owns (f) Evo Air Marketing, a Malaysian company incorporated on February 2, 2021.

The following summary of our operations should be read in conjunction with our unaudited condensed consolidated financial statements for the three and six months ended February ~~28, 2023,~~29, 2024, as compared to the three and six months ended February 28, ~~2022.~~2023.

Three Months Ended February ~~28, 2023,~~29, 2024, versus Three Months Ended February 28, ~~2022~~2023

The Company generated revenues of $41,174 in the three months ended February 29, 2024, as compared to $70,912 in the three months ended February 28, 2023, ~~as compared to $302,884 in the three months ended February 28 2022,~~ a decrease in revenue of ~~$231,972.~~$29,738.

Being first mover in launching EvoAir^TM, first-of-its-kind eco-friendly air-conditioner with granted patent or utility model/ patent or utility model pending HECS system proprietary system, the Group faced both opportunities and challenges. In the course of applying for some of the certifications, safety and performance testing, the relevant authorities/ organizations faced the challenges in assigning our products in the appropriate category under conventional air-conditioner regime. There are instances whereby some of these authorities/ organizations do not possess the relevant equipment to conduct testings. It took a lot of education, discussions, deliberations and working with the authorities/ organizations to work out solutions to resolve compliance and testing matters. On the positive note, one of the authorities advised us to apply under a new category, ‘Hybrid Air Conditioner. The ~~decline~~duration of the application processes were longer than that of typical certifications and testing for conventional air-conditioners.

Being a first mover, notwithstanding many of our corporate clients who were impressed and showed keen interest in ~~revenue for~~our products, EvoAir^TM, many of them took a few months to conduct study on their own accord on performance and the ~~comparative figures is mainly due to the decrease in sales in air purifier products as a result~~energy savings of ~~rollback of preventative measures taken by businesses and public from spreading infection as the World and society progresses towards living with Covid-19.~~our products. The Company is building up its traction for the ~~evoair~~EvoAir^TM hybrid air-conditioners for both residentials and commercial/ industrial ~~units.~~units through distribution channels, projects, building and businesses as well as private labelling and licensing model.

During the financial period, EvoAir Manufacturing entered into an OEM supply agreement (the “OEM Agreement”) with Tadmonsori Holdings Sdn Bhd (“THSB”) pursuant to which the parties have agreed for THSB to purchase certain products (the “Products”) from EvoAir Manufacturing to resell directly under THSB’s branding, trademark, graphics, packaging designs and artwork, with the insertion of the words “Powered by EvoAir” inserted at the back of each Product, to THSB end user customers. The OEM Agreement will be renewable on a three-year basis, and upon the execution of the Agreement, THSB shall have made a minimum order of 3,000 units of the Products upon signing of the OEM Agreement, and to target a total sales turnover of 105,000,000 Malaysia Ringgit (approximately US$22,522,522, as calculated at the Foreign Exchange Rate of US$1 = 4.6620 Malaysia Ringgit on December 8, 2023, as published in H.10 statistical release of the United States Federal Reserve Board) over 3 years from January 1, 2024 to December 31, 2026.

Cost of revenue was ~~$88,940~~$87,075 or ~~125%~~211% of revenue for the three months ended February ~~28, 2023,~~29, 2024, as compared to ~~$194,585~~$88,940 or ~~64%~~125% of revenue in the same financial period in ~~2022.~~2023. The slight decline in cost of revenue is due to the lack of economy of scale for the ~~comparative figures is in line with the drop in sales for the air purifier products.~~production. Cost of revenues includes production costs and purchases of goods.

Gross loss was ~~$18,028~~$45,901 or negative gross profit margin of ~~25%~~111% for the three months ended February ~~28, 2023,~~29, 2024, as compared to gross ~~profit~~loss of ~~$108,299~~$18,028 in the same financial period in ~~2022~~2023 or ~~36%~~25% of revenue. The ~~decline~~increase in gross ~~profit margin for the comparative figures was attributable to the drop in sales for the air purifier products, which contributed higher gross profit margin. The decrease of gross profit~~loss is mainly due to the Company ~~commercialized evoair~~commercializing EvoAir^TM products with higher cost of revenue from manufacturing and related costs as well as lack of economy of scale during commercialization stage. The Company anticipates improvement of income and gross profit margin with the improvement of revenue streams from distributor and dealership model, projects as well as private labeling and licensing model.

Operating expenses were ~~$1,426,781~~$1,473,759 for the three months ended February ~~28, 2023,~~29, 2024, compared to ~~$1,303,079~~$1,426,781 in the corresponding period in ~~2022,~~2023, an increase of ~~$123,702.~~$46,978. The increase in operating expenses ~~were~~was not significant as it’s within 5%.

Other income was $88,902 for the three months ended February 29, 2024, compared to $7,512 in the corresponding period in 2023, an increase of $81,390. The change was mainly due to ~~the commencement of amortization of intangible assets starting~~$82,389 realized foreign exchange gain from ~~January 2022.~~amounts due to shareholders.

The loss from operation before income taxes for the three months ended February ~~28, 2023~~29, 2024, was ~~$1,437,297~~$1,430,758 as compared to ~~$2,188,398~~$1,437,297 for the corresponding period in ~~2022.~~2023. The continuous net loss is attributable to the Group’s focused effort in creating the infrastructure and resource to meet the business expansion needs of the Group’s as well as lack of economies of scale.

Six Months Ended February ~~28, 2023,~~29, 2024, versus Six Months Ended February 28, ~~2022~~2023

	Six Months Ended
	February 28,												Six Months Ended
	2023			2022			Changes			%			February 29, 2024			February 28, 2023			Changes			%
Revenue	$	213,597		$	1,111,763		$	(898,166	)		(81	)%	$	132,492		$	213,597		$	(81,105	)		(38	)%
Cost of revenue		251,798			901,999			(650,201	)		(72	)%		187,401			251,798			(64,397	)		(26	)%
Gross (loss)/profit		(38,201	)		209,764			(247,965	)		(118	)%
Gross loss														(54,909	)		(38,201	)		(16,708	)		(44	)%
Operating expenses		2,853,728			1,813,136			1,040,592			57	%		2,990,751			2,853,728			137,023			5	%
Loss from operation		(2,891,929	)		(1,603,372	)		1,288,557			80	%		(3,045,660	)		(2,891,929	)		(153,731	)		(5	)%
Other income/(expense)		14,489			(968,358	)		(982,847	)		(101	)%
Other income														90,581			14,489			76,092			525	%
Loss from operation before income taxes	$	(2,877,440	)	$	(2,571,730	)		305,710			12	%	$	(2,955,079	)	$	(2,877,440	)		(77,639	)		(3	)%

The Company generated revenues of $132,492 in the six months ended February 29, 2024, as compared to $213,597 in the six months ended February 28, 2023, ~~as compared to $1,111,763 in the six months ended February 28 2022,~~ a decrease in revenue of ~~$898,166.~~$81,105.

Cost of revenue was ~~$251,798~~$187,401 or ~~118%~~141% of revenue for the six months ended February ~~28, 2023~~29, 2024, as compared to ~~$901,999~~$251,798 or ~~81%~~118% of revenue in the same financial period in ~~2022.~~2023. The decline in cost of revenue for the comparative figures is in line with the drop in ~~sales for the air purifier products.~~sales. Cost of revenues includes production costs and purchases of goods.

Gross loss was ~~$38,201~~$54,909 or negative gross profit margin of ~~18%~~41% for the six months ended February ~~28, 2023~~29, 2024, as compared to gross ~~profit~~loss of ~~$209,764~~$38,201 in the same financial period in ~~2022~~2023 or ~~19%~~18% of revenue. The ~~decline in gross profit margin for the comparative figures was attributable to the drop in sales for the air purifier products, which contributed to a higher gross profit margin. The decrease~~increase of gross ~~profit~~loss is mainly due to the Company commercialized ~~evoair~~EvoAir^TMproducts with higher cost of revenue from manufacturing and related costs as well as lack of economy of scale during commercialization stage. The Company anticipates improvement of income and gross profit margin with the improvement of revenue streams from distributor and dealership model, projects as well as private labeling and licensing model.

Operating expenses were ~~$2,853,728~~$2,990,751 for the six months ended February ~~28, 2023~~29, 2024, compared to ~~$1,813,136~~$2,853,728 in the corresponding period in ~~2022,~~2023, an increase of ~~$1,040,592.~~$137,023. The increase in operating expenses ~~were~~was not significant as it’s within 5%.

Other income was $90,581 for the six months ended February 29, 2024, compared to $14,489 in the corresponding period in 2023, an increase of $76,092. The change was mainly due to ~~the commencement of amortization of intangible assets starting~~$82,389 realized foreign exchange gain from ~~January 2022.~~amounts due to shareholders.

The loss from operation before income taxes for the six months ended February ~~28, 2023~~29, 2024, was ~~$2,877,440~~$2,955,079 as compared to ~~$2,571,730~~$2,877,440 for the corresponding period in ~~2022.~~2023. The continuous net loss is attributable to the Group’s focused effort in creating the infrastructure and resource to meet the business expansion needs of the Group’s as well as lack of economies of scale.

	As of February 28,		As of August 31,								As of		As of
	2023		2022		Changes			%			February 29, 2024		August 31, 2023		Changes			%
Current assets	$	1,505,243	$	1,688,926	$	(183,683	)		(11	)%	$	1,394,439	$	2,071,164	$	(676,725	)		(33	)%
Current liabilities		995,056		892,004		103,052			12	%		1,215,947		964,642		251,305			26	%
Working capital		510,187		796,922		(286,735	)		(36	)%		178,492		1,106,522		(928,030	)		(84	)%

As at February ~~28, 2023,~~29, 2024, our company’s current liabilities stood at ~~$995,056,~~$1,394,439, which included accounts payable and accruals of ~~$111,578,~~$252,741, other payables of ~~$21,084,~~$27,439, current portion hire purchase creditor ~~$3,919, amount~~$7,412, amounts due to shareholders ~~$314,165,~~$439,630, current portion operating lease liabilities of ~~$87,983~~$88,952 and the deferred revenue of ~~$456,102.~~$399,773.

As at February ~~28, 2023~~29, 2024 our company had a positive working capital of ~~$510,187~~$178,492 compared with the positive working capital of ~~$796,922~~$1,106,522 as at August 31, ~~2022.~~2023. The ~~decline~~drop in working capital for the comparative figures was mainly attributable to the decrease in cash proceeds from issuance of common stock or capital contribution, decrease in deposits, prepayments and other receivables, ~~and an~~ increase in ~~amount owing~~accounts payable and accruals, and the increase in amounts due to shareholders.

Six Months Ended February ~~28, 2023,~~29, 2024, versus Six Months Ended February 28, ~~2022~~2023

	February 28,			February 28,								February 29,			February 28,
	2023			2022			Changes		%			2024			2023			Changes			%
Cash flows used in operating activities	$	(326,333	)	$	(881,506	)		555,173		63	%	$	(457,609	)	$	(326,333	)		(131,276	)		(40	)%
Cash flows used in investing activity		(11,754	)		(524,148	)		512,394		98	%		(96,186	)		(11,754	)		(84,432	)		(718	)%
Cash flows generated from financing activities		439,233			-			439,233		100	%
Cash flows (used in) generated from financing activities													(4,144	)		439,233			(443,377	)		(101	)%
Net changes in cash		101,146			(1,405,654	)		1,506,800		107	%		(557,939	)		101,146			(659,085	)		(652	)%

The Company’s cash and cash equivalents stood at ~~$242,755~~$137,029 as of February ~~28, 2023.~~29, 2024. Cash used in operating activities for the six months ended February ~~28, 2023,~~29, 2024, was ~~$326,333.~~$457,609. This resulted primarily from a net loss of ~~$2,877,440~~$2,955,079 which was offset by depreciation of ~~$74,828,~~$137,106, amortization of $2,078,694, decrease in operating lease right-of-use assets of ~~$118,116,~~$41,049, decrease in operating leases liabilities of ~~$133,636, decrease~~$43,128, increase in inventories of ~~$46,121,~~$94,838, decrease in deferred revenue of ~~$56,970,~~$40,296, decrease in deposit, prepayment and other receivables of ~~$182,607,~~$128,099, decrease in accounts receivable of ~~$45,406, decrease~~$1,444, increase in accounts payable and accruals of ~~$105,027,~~$81,853, increase in amounts due to shareholders of ~~$311,864,~~$207,535, and decrease in other payables of ~~$10,896.~~

Cash used in investing activity resulted from purchase of property plant and equipment amounting to ~~$11,754~~$96,186 for the six months ended February ~~28, 2023.~~29, 2024.

Cash ~~generated from~~used in financing activities resulted from the ~~proceeds from capital raising amounting to $299,055, proceeds from share to be issued amounting to $144,443, proceeds from capital contribution amounting to $100 and~~ payments of hire purchase amounting to ~~$4,365~~$4,144 during the six months ended February ~~28, 2023.~~29, 2024.

As of the date of this Quarterly Report on Form 10-Q, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Our revenue recognition policy is in compliance with ASC 606, Revenue from Contracts with Customers that revenue is recognized when a customer obtains control of promised goods and is recognized in an amount that reflects the consideration that we expect to receive in exchange for those goods. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that we expect to receive in exchange for those goods. We apply the following five-step model in order to determine this amount:

We only apply the five-step model to contracts when it is probable that we will collect the consideration we are entitled to in exchange for the goods or services we transfer to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, we review the contract to determine which performance obligations we must deliver and which of these performance obligations are distinct. We recognize as revenue the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, our performance obligations are transferred to customers at a point in time, typically upon delivery for local sales and upon shipment of the products for export sale.

For all reporting periods, we have not disclosed the value of unsatisfied performance obligations for all product revenue contracts with an original expected length of one year or less, which is an optional exemption that is permitted under the adopted rules.

In preparing our unaudited condensed consolidated financial statements, we use estimates and assumptions that affect the reported amounts and disclosures. Our estimates are often based on complex judgments, probabilities and assumptions that we believe to be reasonable, but that are inherently uncertain and unpredictable. We are also subject to other risks and uncertainties that may cause actual results to differ from estimated amounts. Significant estimates in ~~2023~~2024 and ~~2022~~2023 include the assumptions used to value tax liabilities, derivative financial instruments, the estimates of the allowance for deferred tax assets, the accounts receivable allowance, impairment of intangible assets and long-lived assets and inventory write-offs.

Due to the COVID-19 pandemic, there has been uncertainty and disruption in the global economy and financial markets which could impact our estimates and assumptions. We have assessed the impact and are not aware of any specific events or circumstances that required an update to our estimates and assumptions or materially affected the carrying value of our assets or liabilities as of the date of issuance of this Quarterly Report on Form 10-Q. These estimates may change as new events occur and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions.

As of February ~~28, 2023~~29, 2024, and August 31, ~~2022,~~ 2023, the Company had an accumulated deficit of ~~$10,214,862~~ $16,334,493 and ~~$7,465,373~~ $13,523,266 respectively. The Company incurred net loss of $2,955,079 and $ $2,877,440 ~~and $2,571,730~~ for the six months ended February ~~28, 2023~~29, 2024, and February 28, ~~2022,~~2023, respectively. The cash used in operating activities ~~were~~was $457,609 and $326,333 ~~and $881,506~~ for the six months ended February ~~28, 2023~~29, 2024, and February 28, ~~2022,~~2023, respectively. It was brought to the attention of the Management to assess going concern considering all facts and circumstances about the foreseeable future of the Company as well as its assets and liabilities on the basis that it will be able to realize and discharge them in the normal course of business.

With the ~~injection~~development of a HVAC ~~Business contemplated under~~business (“HVAC Business”) pursuant to the Transactions (defined in Note 1), the Management believes that the actions to be taken by the Management to further implement the business plans for the HVAC Business including expansion in product offerings, geographical expansion, generate revenue through expansion of revenue streams and customer base (retail, commercial, industrial, projects as well as private label and licensing clientele), improvement of profitability by achieving economies of scale provide the opportunity for the Company to continue as a going concern. In addition, the Company is also working on raising additional funding in conjunction with the Company’s plan to uplist on Nasdaq Capital Market/ NYSE American LLC to finance the operations as well as business expansion.

The unaudited condensed consolidated financials have been prepared assuming that the Company will continue as a going concern and accordingly financial statements do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Except for rules and interpretive releases of the SEC under the authority of federal securities laws and a limited number of grandfathered standards, the ASC is the sole source of authoritative GAAP literature recognized by the FASB and applicable to the Company. Management has reviewed the aforementioned rules and releases and believes any effect will not have a material impact on the Company’s present or future financial statements.

In ~~June 2016,~~August 2020, the FASB issued ASU ~~2016-13, “Measurement~~2020-06, Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40). This ASU reduces the number of ~~Credit Losses~~accounting models for convertible debt instruments and convertible preferred stock and amends the guidance for the derivatives scope exception for contracts in an entity’s own equity to reduce form-over-substance-based accounting conclusions. In addition, this ASU improves and amends the related earnings per share guidance. This standard becomes effective for the Company beginning on ~~Financial Instruments.”~~October 1, 2024. Adoption is either a modified retrospective method or a fully retrospective method of transition. The Company adopted this guidance effective September 1, 2023, and the adoption of this standard did not have a material impact on its consolidated financial statements.

In November 2023, the FASB issued ASU ~~2016-13 adds~~2023-07, Improvement to Reportable Segment Disclosures. This ASU aims to improve segment disclosures through enhanced disclosures about significant segment expenses. The standard requires disclosure of significant expense categories and amounts for such expenses, including those segment expenses that are regularly provided to the ~~CECL impairment model to U.S. GAAP~~chief operating decision maker, easily computable from information that is ~~based on expected losses rather~~regularly provided, or significant expenses that are expressed in a form other than ~~incurred losses. Modified retrospective adoption~~actual amounts. This standard will be effective for the Company in Fiscal Year 2025 and is required ~~with any cumulative-effect adjustment recorded~~ to ~~retained earnings as~~be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of the ~~beginning~~additional disclosure requirements on the Company’s condensed consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, a final standard on improvements to income tax disclosures which applies to all entities subject to income taxes. The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. This standard will be effective for the Company in Fiscal Year 2026 and should be applied prospectively. The Company is currently evaluating the impact of the ~~period~~additional disclosure requirements on the Company’s condensed consolidated financial statements.

Other recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of ~~adoption. ASU 2016-13 is effective for fiscal years beginning after December 15, 2022, including interim periods within~~Certified Public Accountants, and the ~~year of adoption. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company does~~Securities and Exchange Commission did not ~~expect the application of the CECL impairment model~~or are not believed by management to have a ~~significant~~material impact on ~~its allowance for uncollectible amounts for accounts receivable.~~the Company’s present or future financial statements.

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

Our Management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-14(a)(e) and 15d-14(a) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s Management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

An evaluation was conducted under the supervision and with the participation of our Management of the effectiveness of the design and operation of our disclosure controls and procedures as of February ~~28, 2023.~~29, 2024. Based on our Management’s evaluation under the framework in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, our Management concluded that our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms.

A material weakness is a control deficiency, or combination of control deficiencies, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. In connection with the assessment described above, Management identified the following control deficiencies that represent material weaknesses at February ~~28, 2023:~~29, 2024:

● Due to our limited resources, we do not have enough accounting personnel with extensive experience in maintaining books and records and preparing financial statements in accordance with U.S. GAAP which could lead to untimely identification and resolution of accounting matters inherent in our financial transactions in accordance with U.S. GAAP.

● The Company has insufficient written policies and procedures for accounting and financial reporting, which led to inadequate financial statement closing process.

● The Company has a lack of segregation of duties, a lack of audit committee or independent governance/oversight.

There have been no changes in the Company’s internal control over financial reporting during the three months period covered by this Quarterly Report that have materially affected, or are reasonably likely to materially affect the Company’s internal control over financial reporting.

The Company believes the claims are without merit and will defend itself against the claims.

The Management is not aware of any unregistered sales of equity securities and use of proceeds.

No senior securities were issued and outstanding during the three-month period ended February ~~28, 2022.~~29, 2024

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Nevada	98-1353613	8713
(State or Other Jurisdiction of	IRS Employer	Primary Standard Industrial
Incorporation or Organization)	Identification Number	Classification Code Number

Class		Outstanding as of March ~~23, 2023~~31, 2024
Common Stock, $0.001		~~102,003,018~~102,742,362

Part I	FINANCIAL INFORMATION
Item 1	FINANCIAL STATEMENTS (UNAUDITED)	3
Item 2	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	1820
Item 3	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	2326
Item 4	CONTROLS AND PROCEDURES	23 26

PART II	OTHER INFORMATION
Item 1	LEGAL PROCEEDINGS	2427
Item 2	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	2427
Item 3	DEFAULTS UPON SENIOR SECURITIES	2427
Item 4	MINE SAFETY DISCLOSURES	2427
Item 5	OTHER INFORMATION	2427
Item 6	EXHIBITS	2428
	SIGNATURES	2529


	Common Stock				Additional paid in			Accumulated			Accumulated other comprehensive		Shares to be			Non- controlling
	shares		amount		capital			deficit			income		issued			interests			Total

Balance as of August 31, 2021		2,970,000	$	2,970	$	2,890,471		$	(2,233,496	)	$	5,696	$	861,883		$	167,967		$	1,695,491
Foreign currency translation adjustment												168,590					19,013			187,603
Net loss				-		-			(275,208	)				-			(108,124	)		(383,332	)
Balance as of November 30, 2021		2,970,000	$	2,970	$	2,890,471		$	(2,508,704	)	$	174,286	$	861,883		$	78,856		$	1,499,762
Balance		2,970,000	$	2,970	$	2,890,471		$	(2,508,704	)	$	174,286	$	861,883		$	78,856		$	1,499,762
Foreign currency translation adjustment		-		-		-			-			6,466		-			5,185			11,651
Beneficial conversion feature on financial liability -convertible bonds		-		-		1,005,645			-			-		-						1,005,645
Issuance of common stock for convertible bonds		1,116,055		1,116		996,088			-			10,795		-						1,007,999
Issuance of common stock pursuant to share exchange agreement		102,000		102		(102	)		-			-		-			-
Issuance of common stock for technology-related intangible assets		83,147,767		83,148		83,064,619			-			-		-			-			83,147,767
Issuance of common stock pursuant to capital raising		14,443,501		14,443		847,440			-			-		(861,883	)					-
Net loss		-		-		-			(2,104,849	)		-		-			(83,549	)		(2,188,398	)
Balance as of February, 2022		101,779,323	$	101,779	$	88,804,161		$	(4,613,553	)	$	191,547	$	-		$	492		$	84,484,426
Balance		101,779,323	$	101,779	$	88,804,161		$	(4,613,553	)	$	191,547	$	-		$	492		$	84,484,426

(A)	On December 20, 2021, Dr. Low and Chan Kok Wei entered into a share exchange agreement with WKL Eco Earth Holdings Pte Ltd (“WKL Eco Earth Holdings”), pursuant to which Dr. Low and Chan Kok Wei agreed to sell all their ordinary shares of WKL Green Energy Sdn Bhd (“WKL Green Energy”) to WKL Eco Earth Holdings in consideration for the allotment and issuance to WKL Global ~~Limited~~ and Allegro Investment (BVI) Limited (“Allegro Investment”), a company incorporated in the British Virgin Islands (“BVI”) with 50% shareholdings held by Chan Kok Wei and Ong Bee Chen, respectively, of 24,000 shares and 6,000 ~~shares of common stock,~~EvoAir Shares, respectively, or approximately 0.02% and 0.01% of the Then Enlarged Share Capital, respectively.

(B)	On December 20, 2021, Dr. Low, Chan Kok Wei, Ong Bee Chen and certain sellers (“WKLEE Sellers”) entered into a share exchange agreement with WKL Eco Earth Holdings, pursuant to which Dr. Low, Chan Kok Wei, Ong Bee Chen and WKLEE Sellers agreed to sell all their ordinary shares of WKL Eco Earth Sdn Bhd (“WKL Eco Earth”) to WKL Eco Earth Holdings in consideration for the allotment and issuance to WKL Global, ~~Limited,~~ Allegro Investment ~~(BVI) Limited~~ and WKLEE Sellers of 49,320 ~~shares,~~EvoAir Shares, 8,280 ~~shares~~EvoAir Shares and in aggregate 14,400 shares, respectively, ~~of the common stock of the Company,~~ or approximately 0.05%, 0.009% and in aggregate 0.014%, respectively, of the Then Enlarged Share Capital.

(C)	On December 20, 2021, Tan Soon Hock, Ivan Oh Joon Wern and certain relevant interest holders (“Relevant Interest Holders”) entered into an investment exchange agreement with WKL Eco Earth Holdings, pursuant to which Tan Soon Hock, Ivan Oh Joon Wern and the Relevant Interest Holders agreed to sell all relevant interests in the EVOH and its subsidiaries (“EvoAir Group” or the “Group”) to WKL Eco Earth Holdings in consideration for the allotment and issuance of 7,037,762 ~~shares,~~EvoAir Shares, 2,520,000 ~~shares~~EvoAir Shares and in aggregate 6,001,794 EvoAir shares, respectively, ~~of the common stock of the Company,~~ or approximately 6.91%, 2.48% and in aggregate 5.90%, respectively, of the Then Enlarged Share Capital. The board of directors and majority shareholders of the Company have approved the transaction.

●	On February 15, 2022, the Company entered into certain share subscription agreement with Ms. Ang Lee Kim Jane, who is a “non-U.S. Persons” as defined in Regulation S of the Securities Act of 1933, as amended (the “Securities Act”) pursuant to which the Company agreed to issue and sell 74,074 shares of Common Stock, at a per share purchase price of $2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds were $185,185.

●	On June 3, 2022, the Company entered into certain share subscription agreement with Mr. Wong Hon Wai who is a “non-U.S. Persons” as defined in Regulation S of the Securities Act pursuant to which the Company agreed to issue and sell 5,000 shares of Common Stock, at a per share purchase price of $2.50, as part of a series of offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds were $12,500.

●	On February 20, 2023, the Company entered into Regulation S share subscription agreements with eleven investors, each of whom represented that it was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, (i) 57,783 shares of Common Stock to the Regulation S investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were $144,443.

●	On July 13, 2023, the Company entered into Regulation S share subscription agreements with 31 investors, each of whom represented that it was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, (i) 250,132 shares of Common Stock to the Regulation S Investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were approximately $625,330.

●	On September 7, 2023, the Company entered into Regulation S share subscription agreements with 71 investors, each of whom represented that it was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreements, the Company agreed to issue and sell in aggregate, 365,164 shares of Common Stock to the Regulation S investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were approximately $912,889.

●	On November 21, 2023, the Company entered into a Regulation S share subscription agreement with Wong Chun Shoong who represented that he was a “non-U.S. Persons” as defined in Regulation S of the Securities Act. Pursuant to the share subscription agreement, the Company agreed to issue and sell in aggregate, 8,658 shares of Common Stock to the Regulation S investors, at a per share purchase price of $2.50 as part of a series of the offerings by the Company for an aggregate of up to 6,000,000 shares of Common Stock at a per share purchase price of $2.50. The gross proceeds in aggregate were approximately $21,645.

Subsidiaries of EVOH	Attributable interest
EvoAir International Limited (British Virgin Islands)		100	%
Subsidiary of EvoAir International Limited
WKL Eco Earth Holdings Pte Ltd (Singapore)		100	%
Subsidiaries of WKL Eco Earth Holdings Pte Ltd
WKL Eco Earth Sdn Bhd (Malaysia)		100	%
WKL Green Energy Sdn Bhd (Malaysia)		100	%
EvoAir Manufacturing (M) Sdn Bhd (Malaysia)		67.5	%
WKL EcoEarth Indochina Co Ltd (Cambodia)		55	%
WKL Guanzhe Green Technology Guangzhou Co Ltd (China)		55	%
Subsidiary of EvoAir Manufacturing (M) Sdn Bhd
Evo Air Marketing (M) Sdn Bhd (Malaysia)		100	%

		Useful lives
Plant and machineries		5 years
Office equipment		5 years
Vehicles		5 years
Furniture and equipment		10 years
Renovation		10 years

	February 28, 2023		August 31, 2022

Finished goods	$	388,354	$	385,102
Raw materials and supplies		102,423		162,820
WIP		82,098		71,074
Total inventories on hand	$	572,875	$	618,996

	2023			2022
	Six Months Ended,
	February 29, 2024			February 28, 2023
US Statutory rate		21	%		21	%
Effect of reconciling items for tax purposes		(21	)%		(21	)%

Effective income tax rate		-	%		-	%

	Three Months Ended
	February 28,
	2023			2022			Changes			%
Revenue	$	70,912		$	302,884		$	(231,972	)		(77	)%
Cost of revenue		88,940			194,585			(105,645	)		(54	)%
Gross (loss)/profit		(18,028	)		108,299			(126,327	)		(117	)%
Operating expenses		1,426,781			1,303,079			123,702			9	%
Loss from operation		(1,444,809	)		(1,194,780	)		250,029			21	%
Other income/(expenses)		7,512			(993,618	)		(1,001,130	)		(101	)%
Loss from operation before income taxes	$	(1,437,297	)	$	(2,188,398	)		(751,101	)		(34	)%

(i)	identification of the promised goods and services in the contract;

(ii)	determination of whether the promised goods and services are performance obligations, including whether they are distinct in the context of the contract;

(iii)	measurement of the transaction price, including the constraint on variable consideration;

(iv)	allocation of the transaction price to the performance obligations; and

(v)	recognition of revenue when (or as) the Company satisfies each performance obligation.

●	Due to our limited resources, we do not have enough accounting personnel with extensive experience in maintaining books and records and preparing financial statements in accordance with U.S. GAAP which could lead to untimely identification and resolution of accounting matters inherent in our financial transactions in accordance with U.S. GAAP.

●	~~The Company has insufficient written policies and procedures for accounting and financial reporting, which led to inadequate financial statement closing process.~~

●	~~The Company has a lack of segregation of duties, a lack of audit committee or independent governance/oversight.~~

	EvoAir Holdings Inc.

Dated: April ~~14, 2023~~11, 2024	By:	/s/ Low Wai Koon
		Low Wai Koon President and Chief Executive Officer

Dated: April ~~14, 2023~~11, 2024	By:	/s/ Ong Bee Chen
		Ong Bee Chen Chief Financial Officer