8-K: CIMG Inc. Terminates MaloneBailey, LLP as Auditor and Appoints Assentsure PAC

CIMG Inc. announces the termination of MaloneBailey, LLP as its independent auditor and the appointment of Assentsure PAC, effective January 20, 2025.

Summary

• CIMG Inc. has terminated MaloneBailey, LLP as its independent registered public accounting firm, effective January 20, 2025.
• The Audit Committee approved the termination.
• MaloneBailey's reports on the company's financial statements for the fiscal years ended September 30, 2023, and September 30, 2022, did not contain any adverse opinion or disclaimer of opinion, but included an explanatory paragraph regarding the company's ability to continue as a going concern.
• There were no disagreements or reportable events with MaloneBailey during the fiscal years ended September 30, 2024, and September 30, 2023, and the subsequent interim period through January 20, 2025.
• CIMG Inc. has appointed Assentsure PAC as its new independent registered public accounting firm, effective January 20, 2025.
• Assentsure will audit the financial statements for the year ended September 30, 2024, and review the unaudited financial statements for the periods ended December 31, 2024, March 31, 2025, and June 30, 2025.
• The company did not consult with Assentsure on accounting principles or audit opinions prior to the appointment.
• MaloneBailey has provided a letter to the SEC agreeing with the statements made by CIMG Inc. in the report.

Sentiment

Score: 5

Explanation: The sentiment is neutral. While the auditor change itself isn't inherently negative, the previous auditor's 'going concern' mention introduces a degree of caution.

Positives

• MaloneBailey agreed with all statements pertaining to them in the filing.
• The transition to a new auditor appears to be amicable and without significant disagreements.

Negatives

• MaloneBailey's reports included an explanatory paragraph regarding the company's ability to continue as a going concern, which could be a concern for investors.

Risks

• The change in auditors could potentially raise concerns among investors until Assentsure PAC has completed its audit for the year ended September 30, 2024.
• The previous auditor's mention of 'going concern' in their reports indicates potential financial instability.

Future Outlook

The company will have its financial statements for the year ended September 30, 2024, audited by Assentsure PAC, and unaudited financial statements for subsequent interim periods reviewed by them.

Management Comments

• Jianshuang Wang, Chief Executive Officer and Director, signed the report on behalf of CIMG Inc.

Industry Context

Changes in auditors are not uncommon, but they can sometimes signal underlying issues within a company. Investors often scrutinize the reasons behind auditor changes to assess potential risks.

Comparison to Industry Standards

• Auditor changes are a normal part of business, but the circumstances surrounding the change are important.
• Companies like Enron and WorldCom had auditor issues that were a precursor to larger problems.
• It is important to compare the fees paid to the previous auditor with the fees to be paid to the new auditor to ensure that the company is not cutting costs at the expense of quality.

Stakeholder Impact

• Shareholders may be concerned about the change in auditors and the previous auditor's 'going concern' mention.
• Employees may be indirectly affected if the company's financial stability is questioned.

Next Steps

• Assentsure PAC will audit the financial statements for the year ended September 30, 2024.
• Assentsure PAC will review the unaudited financial statements for the periods ended December 31, 2024, March 31, 2025, and June 30, 2025.

Key Dates