What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2023-12-28 compared with 2022-12-28 · 1781 added, 1277 removed, 723 unchanged (81% of the section changed)

CONTROLS AND PROCEDURES

Controls and Procedures

maintain “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange

Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed by us

in reports 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, and that such information is accumulated and communicated to our management, including our

principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

In designing and evaluating our disclosure controls and procedures, management recognized that disclosure controls and procedures, no

matter how well conceived and operated, can provide only reasonable assurance of achieving the desired control objectives, and we necessarily

are required to apply our judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures.

on an evaluation under the supervision and with the participation of our management, our principal executive officer and principal financial

officer have concluded that our disclosure controls and procedures were not effective as of September 30, 2022 due to the material weaknesses

described below.

Annual Report on Internal Control Over Financial Reporting

management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined

in Rules 13a-15(f) and 15d-15(f) of the Exchange Act.

Our internal control system was designed to provide reasonable assurance regarding

the reliability of financial reporting and the preparation of financial statements for external purposes, in accordance with GAAP.

of inherent limitations, a system of internal control over financial reporting may not prevent or detect misstatements.

Additionally,

projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to change

in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

management, including our principal executive officer and principal accounting officer, conducted an evaluation of the effectiveness

of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway

Commission (“COSO”) in Internal Control—Integrated Framework (2013).

Based on its evaluation, our management concluded

that as of September 30, 2022, that our internal control over financial reporting were not effective and there are material weaknesses

in our internal control over financial reporting.

The material weaknesses relate to the Company lacking sufficient, qualified, accounting

The shortage of qualified accounting personnel resulted in the Company lacking entity level controls around the review of

period-end reporting processes, accounting policies and public disclosures.

Additionally, the Company’s current processes and systems

do not provide for necessary timely reconciliation of certain accounts and sufficient consideration regarding recoverability of certain

These deficiencies are common in small companies, similar to us, with limited personnel.

order to mitigate the material weaknesses, the Company has implemented measures that they believe have mitigated these weaknesses but

has not had sufficient time to fully test these measures.

These measures include;

(i) updating our accounting software to ensure tighter

control over entries and providing improved data for timely reconciliation of certain accounts, and (ii) engaged a third-party accounting

firm to provide review of period-end reporting processes, accounting policies and public disclosures

annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control

Disclosure Controls and Procedures

maintain “ disclosure controls and procedures, ” as

defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “ Exchange

Act ” ), that are designed to ensure that information required to

be disclosed by us in reports 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, and that

such information is accumulated and communicated to our management, including our principal executive officer and principal financial

officer, as appropriate, to allow timely decisions regarding required disclosure.

In designing and evaluating our disclosure controls

and procedures, management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide

only reasonable assurance of achieving the desired control objectives, and we necessarily are required to apply our judgment in evaluating

the cost-benefit relationship of possible disclosure controls and procedures.

Based on an evaluation under the

supervision and with the participation of our management, our principal executive officer and principal financial officer have concluded

that our disclosure controls and procedures were effective as of September 30, 2023.

Management’s Annual Report on Internal Control

Over Financial Reporting

Management’s report was not subject to attestation by the Company’s registered public accounting

firm pursuant to Commission rules that permit the Company to provide only management’s report in this annual report.

report shall not be deemed to be filed for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that

section, and is not incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless

of any general incorporation language in such filing.

in Internal Control Over Financial Reporting

the year ended September 30, 2022, The Company engaged a third-party accounting firm to assist with entity level controls around the

review of period-end reporting processes, accounting policies and public disclosures that is reasonably likely to materially affect our

internal control over financial reporting.

Our management is responsible

for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f)

of the Exchange Act.

Our internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting

and the preparation of financial statements for external purposes, in accordance with GAAP.

Because of inherent limitations, a system

of internal control over financial reporting may not prevent or detect misstatements.

Additionally, projections of any evaluation of effectiveness

to future periods are subject to the risk that controls may become inadequate due to change in conditions, or that the degree of compliance

with the policies or procedures may deteriorate.

management, including our principal executive officer and principal accounting officer, conducted an evaluation of the effectiveness of

our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway

Commission ( “ COSO ” )

in Internal Control—Integrated Framework (2013).

Based on its evaluation, our management concluded that as of September 30, 2023,

that our internal control over financial reporting were effective and there are no material weaknesses in our internal control over financial

annual report does not include an attestation report of the Company ’ s

registered public accounting firm regarding internal control over financial reporting.

Management ’ s

report was not subject to attestation by the Company ’ s registered

public accounting firm pursuant to Commission rules that permit the Company to provide only management ’ s

report in this annual report.

This report shall not be deemed

to be filed for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities of that section, and is not incorporated

by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation language

in such filing.

Changes in Internal Control Over Financial Reporting

During the years ended September

30, 2023, and 2022, the Company engaged a third-party accounting firm to assist with entity level controls around the review of period-end

reporting processes, accounting policies and public disclosures that is reasonably likely to materially affect our internal control over

financial reporting.

OTHER INFORMATION

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

and Executive Officers of the Registrant

of the date of this Annual Report, the members of our Board of Directors and Executive Officers are:

of the Board of Directors,President,

DISCLOSURE REGARDING FOREIGN JURISDICTIONS

THAT PREVENT INSPECTIONS

DIRECTORS, EXECUTIVE OFFICERS

AND CORPORATE GOVERNANCE

Directors and Executive Officers of the Registrant

As of the date of this Annual Report, the members

of our Board of Directors and Executive Officers are:

Name and Address

Positions and Offices

Chairman of the Board of Directors,President,

276 Greenpoint Avenue, Suite 208

Executive Officer, & Director

Chief Financial Officer

Chief Executive Officer, & Director

Brooklyn, NY 11222

Interim Chief Financial Officer

276 Greenpoint Avenue, Suite 208

Brooklyn, NY 11222

276 Greenpoint Avenue, Suite 208

Brooklyn, NY 11222

Manpreet Singh

276 Greenpoint Avenue, Suite 208

Brooklyn, NY 11222

Metodi Filipov

276 Greenpoint Avenue, Suite 208

Occupations and Business Experience of Directors and Executive Officers

following is a brief account of the business experience of the Company’s directors:

Govil is the Company’s Chairman since June 2014, and the Chief Executive Officer and President since December 2011.

working at Cemtrex since 2008, initially as a field engineer, subsequently moving into sales, and management roles as Vice President

of Operations.

Saagar was recently recognized as a Forbes’ 30 Under 30 in 2016, Business Insiders #17 on Top 100 of Silicon Alley

in 2015, and Top 40 Under 40 by Stony Brook University in 2014.

Brooklyn, NY 11222

Principal Occupations and Business Experience of Directors and Executive

The following is a brief account of the business experience

of the Company’s directors:

Saagar Govil is the Company’s

Chairman since June 2014, and the Chief Executive Officer and President since December 2011.

He has been working at Cemtrex since 2008,

initially as a field engineer, subsequently moving into sales, and management roles as Vice President of Operations.

Saagar was recently

recognized as a Forbes’ 30 Under 30 in 2016, Business Insiders #17 on Top 100 of Silicon Alley in 2015, and Top 40 Under 40 by Stony

Brook University in 2014.

Saagar Govil has a B.E.

in Materials Engineering from Stony Brook University

and completed the PLD program at Harvard Business School.

Wyckoff was appointed Cemtrex’s Interim Chief Financial Officer on January 28, 2021, where he is responsible for the Company’s

financial planning, accounting, tax, and business process functions.

Wyckoff has been with Cemtrex since March of 2014 when he joined

as the Manager of Financial Reporting and since January of 2019 has served as the Company’s Corporate Controller.

Prior to joining

Wyckoff was the Controller at Vaso Corporation (formerly Vasomedical, Inc.) a medical device distribution company based

in Plainview, NY.

Wyckoff has nearly 20 years of private accounting experience and holds a B.S.

in Accounting from SUNY College at

Old Westbury.

Kwon was appointed to the as a director on September 28, 2021 and is presently the President and Chief Procurement Officer of H Mart.

Brian has extensive operations experience in purchasing, distribution, logistics, IT, HR, and e-commerce from his time at H-Mart.

has completed the Harvard Business School General Management Program.

Singh was appointed as a director on November 1, 2021 and is currently the founder and Chief Investment Officer of Singh Capital Partners

(SCP), a multifamily office that directs investments into venture capital, real estate, and growth equity.

SCP invests capital on behalf

of Fortune 500 CXOs, Unicorn founders and operators and has executed investments in North America, Europe and Asia.

He serves on the

numerous non-profit and private company boards including AcquCo, US Inspect, Embrace Software, Snowball Industries, Shukr Investments,

Suburban Hospital (John Hopkins Medicine) and Dingman Center at the Smith School of Business.

He is a CFA charterholder and Manpreet

received his MBA from the Wharton School of Business in Entrepreneurship, Finance, and Real Estate.

in Materials Engineering from Stony Brook University and completed the PLD program at

Harvard Business School.

Wyckoff was appointed

Cemtrex’s Interim Chief Financial Officer on January 28, 2021, where he is responsible for the Company’s financial planning,

accounting, tax, and business process functions.

Wyckoff has been with Cemtrex since March of 2014 when he joined as the Manager of

Financial Reporting and since January of 2019 has served as the Company’s Corporate Controller.

Prior to joining Cemtrex, Mr.

was the Controller at Vaso Corporation (formerly Vasomedical, Inc.) a medical device distribution company based in Plainview, NY.

Wyckoff has over 20 years of private accounting experience and holds a B.S.

in Accounting from SUNY College at Old Westbury.

Brian Kwon was appointed to the

as a director on September 28, 2021 and is presently the President and Chief Procurement Officer of H Mart.

Brian has extensive operations

experience in purchasing, distribution, logistics, IT, HR, and e-commerce from his time at H-Mart.

Brian has completed the Harvard Business

School General Management Program.

Manpreet Singh was appointed

as a director on November 1, 2021 and is currently the founder and Chief Investment Officer of Singh Capital Partners (SCP), a multifamily

office that directs investments into venture capital, real estate, and growth equity.

SCP invests capital on behalf of Fortune 500 CXOs,

Unicorn founders and operators and has executed investments in North America, Europe and Asia.

He serves on the numerous non-profit and

private company boards including AcquCo, US Inspect, Embrace Software, Snowball Industries, Shukr Investments, Suburban Hospital (John

Hopkins Medicine) and Dingman Center at the Smith School of Business.

He is a CFA charterholder and Manpreet received his MBA from the

Wharton School of Business in Entrepreneurship, Finance, and Real Estate.

He also holds a B.S.

in Finance with

a citation in Entrepreneurship from the University of Maryland, College Park.

Singh’s extensive knowledge of finance allow

him to make valuable contributions to the Board.

Filipov was appointed to the Board on February 9, 2018 and is an entrepreneur and technology executive with over 25 years of experience

creating, operating and driving growth for technology companies.

He has a proven track record of identifying business opportunities and

building compelling products.

in Finance with a citation in Entrepreneurship

from the University of Maryland, College Park.

Singh’s extensive knowledge of finance allow him to make valuable contributions

to the Board.

Metodi Filipov was appointed to

the Board on February 9, 2018 and is an entrepreneur and technology executive with over 25 years of experience creating, operating and

driving growth for technology companies.

He has a proven track record of identifying business opportunities and building compelling products.

Metodi was formerly VP of Operations at Cemtrex from 2008 to 2010.

After Cemtrex, Mr.

Filipov served as

Managing Director of Bianor, a mobile consulting company providing solutions for enterprise clients.

There, he led the development and

implementation of innovative mobile products in industries including aviation, pharmaceutical and entertainment.

Metodi co-founded Flipps

Media, an OTT video distribution platform positioned to be an alternative to traditional cable pay-per-view systems.

Before Bianor, he

served as product lead for Raritan, a data center technology organization, where he was an integral part of the transition team that

led the company to becoming a global IT service management solutions provider.

Filipov served as Managing Director of Bianor, a

mobile consulting company providing solutions for enterprise clients.

There, he led the development and implementation of innovative mobile

products in industries including aviation, pharmaceutical and entertainment.

Metodi co-founded Flipps Media, an OTT video distribution

platform positioned to be an alternative to traditional cable pay-per-view systems.

Before Bianor, he served as product lead for Raritan,

a data center technology organization, where he was an integral part of the transition team that led the company to becoming a global

IT service management solutions provider.

Prior to joining Raritan, Mr.

Filipov served as VP of

Operations at ISS, a security products company.

There, he successfully managed product development and contract manufacturing across

Filipov has extensive experience delivering superior solutions with a focus on optimized efficiency and productivity.

director of the Company serves for a term of one year or until the successor is elected at the Company’s annual shareholders’

meeting and is qualified, subject to removal by the Company’s shareholders.

Each officer serves, at the pleasure of the board of

directors, for a term of one year and until the successor is elected at the annual meeting of the board of directors and is qualified.

of the Board of Directors

the fiscal year ended September 30, 2022 (“Fiscal 2022”), the Board of Directors held four meetings.

in Certain Legal Proceedings

the past 10 years, other than as set forth below, none of our current directors, nominees for directors or current executive officers

has been involved in any legal proceeding identified in Item 401(f) of Regulation S-K, including:

Any petition under the Federal bankruptcy laws or any state insolvency law filed by or against, or a receiver, fiscal agent or similar

officer was appointed by a court for the business or property of such person, or any partnership in which he or she was a general partner

at or within two years before the time of such filing, or any corporation or business association of which he or she was an executive

officer at or within two years before the time of such filing;

Any conviction in a criminal proceeding or being named a subject of a pending criminal proceeding (excluding traffic violations and other

minor offenses);

Being subject to any order, judgment, or decree, not subsequently reversed, suspended, or vacated, of any court of competent jurisdiction,

permanently or temporarily enjoining him or her from, or otherwise limiting, the following activities:

Acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage

transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing,

or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment

company, bank, savings and loan association or insurance company, or engaging in or continuing any conduct or practice in connection

with such activity;

Engaging in any type of business practice;

Engaging in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of

Federal or State securities laws or Federal commodities laws;

Being subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring,

suspending or otherwise limiting for more than 60 days the right of such person to engage in any type of business regulated by the Commodity

Futures Trading Commission, securities, investment, insurance or banking activities, or to be associated with persons engaged in any

such activity;

Being found by a court of competent jurisdiction in a civil action or by the SEC to have violated any Federal or State securities law,

and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended, or vacated;

Being found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any

Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently

reversed, suspended or vacated;

Being subject to, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently

reversed, suspended or vacated, relating to an alleged violation of:

Any Federal or State securities or commodities law or regulation;

Any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent

injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or

prohibition order;

Any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity;

Being subject to, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization

(as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C.

78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of

the Commodity Exchange Act (7 U.S.C.

1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary

authority over its members or persons associated with a member.

subsection titled “Settlement with the Securities and Exchange Commission” under Item 1.

Business of this Annual Report on

Form 10-K, which is incorporated herein by reference.

Board of Directors currently has one standing committee:

Filipov served as VP of Operations at ISS, a security products

There, he successfully managed product development and contract manufacturing across continents.

Filipov has extensive experience

delivering superior solutions with a focus on optimized efficiency and productivity.

Each director of the Company serves

for a term of one year or until the successor is elected at the Company’s annual shareholders’ meeting and is qualified, subject

to removal by the Company’s shareholders.

Each officer serves, at the pleasure of the board of directors, for a term of one year

and until the successor is elected at the annual meeting of the board of directors and is qualified.

Meetings of the Board of Directors

During the fiscal year ended

September 30, 2023, the Board of Directors held four meetings.

Involvement in Certain Legal Proceedings

During the past 10 years, other

than as set forth below, none of our current directors, nominees for directors or current executive officers has been involved in any

legal proceeding identified in Item 401(f) of Regulation S-K, including:

Any petition under the Federal

bankruptcy laws or any state insolvency law filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court

for the business or property of such person, or any partnership in which he or she was a general partner at or within two years before

the time of such filing, or any corporation or business association of which he or she was an executive officer at or within two years

before the time of such filing;

Any conviction in a criminal

proceeding or being named a subject of a pending criminal proceeding (excluding traffic violations and other minor offenses);

Being subject to any order,

judgment, or decree, not subsequently reversed, suspended, or vacated, of any court of competent jurisdiction, permanently or temporarily

enjoining him or her from, or otherwise limiting, the following activities:

Acting as a futures commission

merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage transaction merchant, any other

person regulated by the Commodity Futures Trading Commission, or an associated person of any of the foregoing, or as an investment adviser,

underwriter, broker or dealer in securities, or as an affiliated person, director or employee of any investment company, bank, savings

and loan association or insurance company, or engaging in or continuing any conduct or practice in connection with such activity;

Engaging in any type of business

Engaging in any activity

in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal or State securities

laws or Federal commodities laws;

Being subject to any order,

judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State authority barring, suspending or otherwise

limiting for more than 60 days the right of such person to engage in any type of business regulated by the Commodity Futures Trading Commission,

securities, investment, insurance or banking activities, or to be associated with persons engaged in any such activity;

Being found by a court of competent

jurisdiction in a civil action or by the SEC to have violated any Federal or State securities law, and the judgment in such civil action

or finding by the Commission has not been subsequently reversed, suspended, or vacated;

Being found by a court of competent

jurisdiction in a civil action or by the Commodity Futures Trading Commission to have violated any Federal commodities law, and the judgment

in such civil action or finding by the Commodity Futures Trading Commission has not been subsequently reversed, suspended or vacated;

Being subject to, or a party

to, any Federal or State judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated,

relating to an alleged violation of:

Any Federal or State securities

or commodities law or regulation;

Any law or regulation respecting

financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement

or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order;

Any law or regulation prohibiting

mail or wire fraud or fraud in connection with any business entity;

Being subject to, or a party

to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section

3(a)(26) of the Exchange Act (15 U.S.C.

78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange

Act (7 U.S.C.

1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members

or persons associated with a member.

See subsection titled “Settlement

with the Securities and Exchange Commission” under Item 1.

Business of this Annual Report on Form 10-K, which is incorporated herein

by reference.

Committees of the Board

Our Board of Directors currently

has one standing committee:

The Audit Committee.

a “Controlled Company” as such term is defined under NASDAQ Listing Rule 5615, the Company is not required to have a Compensation

Audit Committee, which has been established in accordance with requirements of Section 3(a)(58)(A) of the Exchange Act, is comprised

of the following independent directors:

Compensation Committee

As a “Controlled Company”

as such term is defined under NASDAQ Listing Rule 5615, the Company is not required to have a Compensation Committee.

Audit Committee

The Audit Committee, which has

been established in accordance with requirements of Section 3(a)(58)(A) of the Exchange Act, is comprised of the following independent

Metodi Filipov (Chair), Brian Kwon, and Manpreet Singh.

The Board of Directors has determined

that each member of the Audit Committee:

(i) is independent, (ii) meets the financial literacy requirements of the Nasdaq Rules, and

(iii) meets the enhanced independence standards established by the SEC.

The Board of Directors has determined that each member of the Audit

(i) is independent, (ii) meets the financial literacy requirements of the Nasdaq Rules, and (iii) meets the enhanced independence

standards established by the SEC.

In addition, the Board has determined that Mr.

Filipov qualifies

as an “audit committee financial expert” as that term is defined in Item 407(d)(5)(ii) of Regulation S-K promulgated under

the Exchange Act by the SEC.

Audit Committee is primarily concerned with the integrity of our financial statements, the independence, qualifications and performance

of our independent registered public accounting firm, and our compliance with legal requirements.

The Audit Committee operates under

a written charter approved by the Board of Directors and the Audit Committee that reflects standards and requirements adopted by the

SEC and NASDAQ.

indicated in its charter, the Audit Committee’s duties include selecting and engaging our independent registered public accounting

reviewing the scope of the audit to be conducted by our independent registered public accounting firm;

overseeing our independent

registered public accounting firm and reviewing the results of its audit;

reviewing our financial reporting processes, including the

accounting principles and practices followed and the financial information provided to shareholders and others;

overseeing our internal

control over financial reporting and disclosure controls and procedures;

Filipov qualifies as an “audit committee financial

expert” as that term is defined in Item 407(d)(5)(ii) of Regulation S-K promulgated under the Exchange Act by the SEC.

The Audit Committee is primarily

concerned with the integrity of our financial statements, the independence, qualifications and performance of our independent registered

public accounting firm, and our compliance with legal requirements.

The Audit Committee operates under a written charter approved by the

Board of Directors and the Audit Committee that reflects standards and requirements adopted by the SEC and NASDAQ.

As indicated in its charter,

the Audit Committee’s duties include selecting and engaging our independent registered public accounting firm;

reviewing the scope

of the audit to be conducted by our independent registered public accounting firm;

overseeing our independent registered public accounting

firm and reviewing the results of its audit;

reviewing our financial reporting processes, including the accounting principles and practices

followed and the financial information provided to shareholders and others;

overseeing our internal control over financial reporting and

disclosure controls and procedures;

and serving as our legal compliance committee.

Company does not currently have a standing nominating committee or a formal nominating committee charter.

As a “Controlled Company”

as such term is defined by NASDAQ Listing Rule 5615 the Company is not required to have a Nominating Committee.

Currently, the independent

members of the Board (Messrs.

Kwon, Singh, Wagner, and Filipov), rather than a nominating committee, approve or recommend to the full

Board those persons to be nominated.

The Board believes that the current method of nominating directors is appropriate because it allows

each independent board member input into the nomination process and does not unnecessarily restrict the input that might be provided

from an independent director who could be excluded from a committee.

Nomination of Directors

The Company does not currently

have a standing nominating committee or a formal nominating committee charter.

As a “Controlled Company” as such term is defined

by NASDAQ Listing Rule 5615 the Company is not required to have a Nominating Committee.

Currently, the independent members of the Board

Kwon, Singh, Wagner, and Filipov), rather than a nominating committee, approve or recommend to the full Board those persons to

be nominated.

The Board believes that the current method of nominating directors is appropriate because it allows each independent board

member input into the nomination process and does not unnecessarily restrict the input that might be provided from an independent director

who could be excluded from a committee.

Currently, three of the five Directors are independent.

the Board has adopted by resolution a director nomination policy.

The purpose of the policy is to describe the process by which candidates

for inclusion in the Company’s recommended slate of director nominees are selected.

The director nomination policy is administered

by the Board.

Many of the benefits that would otherwise come from a written committee charter are provided by this policy.

the ordinary course, absent special circumstances or a change in the criteria for Board membership, the incumbent directors who continue

to be qualified for Board service and are willing to continue as directors are re-nominated.

If the Board thinks it is in the best interest

of the Company to nominate a new individual for director in connection with an annual meeting of shareholders, or if a vacancy occurs

between annual shareholder meetings, the Board will seek potential candidates for Board appointments who meet the criteria for selection

as a nominee and have the specific qualities or skills being sought.

Director candidates will be selected based on input from members

of the Board, senior management of the Company and, if deemed appropriate, a third-party search firm.

for Board membership must possess the background, skills and expertise to make significant contributions to the Board, to the Company

and its shareholders.

Furthermore, the Board has adopted by

resolution a director nomination policy.

The purpose of the policy is to describe the process by which candidates for inclusion in the

Company’s recommended slate of director nominees are selected.

The director nomination policy is administered by the Board.

of the benefits that would otherwise come from a written committee charter are provided by this policy.

In the ordinary course, absent

special circumstances or a change in the criteria for Board membership, the incumbent directors who continue to be qualified for Board

service and are willing to continue as directors are re-nominated.

If the Board thinks it is in the best interest of the Company to nominate

a new individual for director in connection with an annual meeting of shareholders, or if a vacancy occurs between annual shareholder

meetings, the Board will seek potential candidates for Board appointments who meet the criteria for selection as a nominee and have the

specific qualities or skills being sought.

Director candidates will be selected based on input from members of the Board, senior management

of the Company and, if deemed appropriate, a third-party search firm.

Candidates for Board membership

must possess the background, skills and expertise to make significant contributions to the Board, to the Company and its shareholders.

Desired qualities to be considered include substantial experience in business or administrative activities;

of knowledge about issues affecting the Company;

breadth of knowledge about

issues affecting the Company;

and ability and willingness to contribute special competencies to Board activities.

Board of Directors intends to review the director nomination policy from time to time to consider whether modifications to the policy

may be advisable as the Company’s needs and circumstances evolve, and as applicable legal or listing standards change.

may amend the director nomination policy at any time.

Board will consider director candidates recommended by shareholders and will evaluate such director candidates in the same manner in

which it evaluates candidates recommended by other sources, as described above.

Recommendations must be in writing and mailed to Cemtrex,

Inc., 276 Greenpoint Avenue, Suite 208, Brooklyn, NY 11222, Attention:

Corporate Secretary, and include all information regarding the

candidate as would be required to be included in a proxy statement filed pursuant to the proxy rules promulgated by the SEC if the candidate

were nominated by the Board of Directors (including such candidate’s written consent to being named in the proxy statement as a

nominee and to serving as a director if elected).

The shareholder giving notice must provide (i) his or her name and address, as they

appear on the Company’s books, and (ii) the number of shares of the Company which are beneficially owned by such shareholder.

Company may require any proposed nominee to furnish such other information it may require to be set forth in a shareholder’s notice

of nomination which pertains to the nominee.

members of the Board receive quarterly compensation of $5,000 and stock options.

Additionally, we reimburse our directors for expenses

incurred in connection with attending board meetings.

Trading Policy

recognize that the Company’s executive officers and directors may sell shares from time to time in the open market to realize value

to meet financial needs and diversify their holdings, particularly in connection with exercises of stock options.

All such transactions

are required to comply with the Company’s insider trading policy.

16 (a) Beneficial Ownership Reporting Compliance of the Securities Exchange Act

16(a) of the Exchange Act requires directors, executive officers and persons who beneficially own more than 10% of our common stock (collectively,

“Reporting Persons”) to file initial reports of ownership and reports of changes in ownership of our common stock with the

Reporting Persons are required by SEC regulations to furnish us with copies of all Section 16(a) reports they file.

To our knowledge,

based solely on our review of the copies of such reports received or written representations from certain Reporting Persons that no other

reports were required, we believe that during the year ended September 30, 2021 all Reporting Persons timely complied with all applicable

filing requirements.

Communications

with Directors

Shareholders,

associates of the Company and other interested parties may communicate directly with the Board of Directors, with the non-management

Directors or with a specific Board member, by writing to the Board (or the non-management Directors or a specific Board member) and delivering

the communication in person or mailing it to:

Board of Directors, Privileged & Confidential, c/o Saagar Govil, CEO, Cemtrex, Inc.,

276 Greenpoint Avenue, Suite 208, Brooklyn, NY 11222.

Correspondence will be discussed at the next scheduled meeting of the Board of

Directors, or as indicated by the urgency of the matter.

From time to time, the Board of Directors may change the process by which shareholders

may communicate with the Board of Directors or its members.

Any changes in this process will be posted on the Company’s website

or otherwise publicly disclosed.

Company has an ongoing commitment to good governance and business practices.

In furtherance of this commitment, we regularly monitor,

and are briefed by outside counsel on, developments in the area of corporate governance and securities law and review our policies and

procedures in light of such developments.

We comply with the rules and regulations promulgated by the SEC and implement other corporate

governance practices we believe are in the best interests of the Company and the shareholders.

have adopted a code of ethics as of June 28, 2016, that applies to our principal executive officer, principal financial officer, as well

as our employees.

Our standards are in writing and are posted on our website.

The following is a summation of the key points of the Code

of Ethics we adopted:

and ethical conduct, including ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

fair, accurate, timely, and understandable disclosure reports and documents that a small business issuer files with, or submits to, the

Commission and in other public communications made by our Company;

compliance with applicable government laws, rules and regulations;

prompt internal reporting of violations of the code to an appropriate person or persons identified in the code;

Accountability

for adherence to the code.

Leadership and Structure

Govil, our Chief Executive Officer, also serves as Chairman of the Board of Directors.

The Board believes that the Company and its shareholders

are best served by having the Chief Executive Officer also serve as Chairman of the Board.

The Board also believes that this structure

is appropriate in light of the size of our Company and corresponding size of our Board and the complexity of our business.

Govil is best positioned to develop agendas that ensure that our Board’s time and attention are focused on the matters

that are most critical to us.

The Board of Directors intends

to review the director nomination policy from time to time to consider whether modifications to the policy may be advisable as the Company’s

needs and circumstances evolve, and as applicable legal or listing standards change.

The Board may amend the director nomination policy

The Board will consider director

candidates recommended by shareholders and will evaluate such director candidates in the same manner in which it evaluates candidates

recommended by other sources, as described above.

Recommendations must be in writing and mailed to Cemtrex, Inc., 135 Fell Ct.

NY 11788, Attention:

Corporate Secretary, and include all information regarding the candidate as would be required to be included in a

proxy statement filed pursuant to the proxy rules promulgated by the SEC if the candidate were nominated by the Board of Directors (including

such candidate’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected).

shareholder giving notice must provide (i) his or her name and address, as they appear on the Company’s books, and (ii) the number

of shares of the Company which are beneficially owned by such shareholder.

The Company may require any proposed nominee to furnish such

other information it may require to be set forth in a shareholder’s notice of nomination which pertains to the nominee.

Director Compensation

The members of the Board receive

quarterly compensation of $5,000 and stock options.

Additionally, we reimburse our directors for expenses incurred in connection with

attending board meetings.

Insider Trading Policy

We recognize that the Company’s

executive officers and directors may sell shares from time to time in the open market to realize value to meet financial needs and diversify

their holdings, particularly in connection with exercises of stock options.

All such transactions are required to comply with the Company’s

insider trading policy.

Section 16 (a) Beneficial Ownership Reporting Compliance of the Securities

Section 16(a) of the Exchange

Act requires directors, executive officers and persons who beneficially own more than 10% of our common stock (collectively, “Reporting

Persons”) to file initial reports of ownership and reports of changes in ownership of our common stock with the SEC.

Reporting Persons

are required by SEC regulations to furnish us with copies of all Section 16(a) reports they file.

To our knowledge, based solely on our

review of the copies of such reports received or written representations from certain Reporting Persons that no other reports were required,

we believe that during the year ended September 30, 2023, all Reporting Persons timely complied with all applicable filing requirements,

except for one Form 4 report by Mr.

Govil that was filed late.

Communications with Directors

Shareholders, associates of the

Company and other interested parties may communicate directly with the Board of Directors, with the non-management Directors or with a

specific Board member, by writing to the Board (or the non-management Directors or a specific Board member) and delivering the communication

in person or mailing it to:

Board of Directors, Privileged and Confidential, c/o Saagar Govil, CEO, Cemtrex, Inc., 135 Fell Ct.

Correspondence will be discussed at the next scheduled meeting of the Board of Directors, or as indicated by the urgency of

From time to time, the Board of Directors may change the process by which shareholders may communicate with the Board of Directors

or its members.

Any changes in this process will be posted on the Company’s website or otherwise publicly disclosed.

Corporate Governance

The Company has an ongoing commitment

to good governance and business practices.

In furtherance of this commitment, we regularly monitor, and are briefed by outside counsel

on, developments in the area of corporate governance and securities law and review our policies and procedures in light of such developments.

We comply with the rules and regulations promulgated by the SEC and implement other corporate governance practices we believe are in the

best interests of the Company and the shareholders.

Code of Ethics

We have adopted a code of ethics

as of June 28, 2016, that applies to our principal executive officer, principal financial officer, as well as our employees.

Our standards

are in writing and are posted on our website.

The following is a summation of the key points of the Code of Ethics we adopted:

Honest and ethical

conduct, including ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

Full, fair, accurate,

timely, and understandable disclosure reports and documents that a small business issuer files with, or submits to, the Commission and

in other public communications made by our Company;

Full compliance with

applicable government laws, rules and regulations;

The prompt internal

reporting of violations of the code to an appropriate person or persons identified in the code;

Accountability for

adherence to the code.

Board Leadership and Structure

Saagar Govil, our Chief Executive

Officer, also serves as Chairman of the Board of Directors.

The Board believes that the Company and its shareholders are best served by

having the Chief Executive Officer also serve as Chairman of the Board.

The Board also believes that this structure is appropriate in

light of the size of our Company and corresponding size of our Board and the complexity of our business.

We believe that Mr.

best positioned to develop agendas that ensure that our Board’s time and attention are focused on the matters that are most critical

EXECUTIVE COMPENSATION

compensation discussion addresses all compensation awarded to, earned by, or paid to the Company’s named executive officers (“NEO”),

which currently consists of Saagar Govil, the Chairman, Chief Executive Officer, President and Secretary, and Paul J.

Wyckoff, Interim

As of December 23, 2022, Saagar Govil and Paul J.

The compensation discussion addresses

all compensation awarded to, earned by, or paid to the Company’s named executive officers (“NEO”), which currently consists

of Saagar Govil, the Chairman, Chief Executive Officer, President and Secretary, and Paul J.

Wyckoff, Interim CFO.

As of the date of this

Annual Report, Saagar Govil and Paul J.

Wyckoff are currently earning compensation from the Company.

named Interim CFO on January 28, 2022.

Set forth below is the aggregate compensation for services rendered in all capacities to us during

our fiscal years ended September 30, 2021, and 2022 by our executive officers.

Wyckoff was named Interim

CFO on January 28, 2022.

Set forth below is the aggregate compensation for services rendered in all capacities to us during our fiscal

years ended September 30, 2023, and 2022 by our executive officers.

PRINCIPAL AND POSITION

Executive Officer, and President

Chief Financial Officer

FormerExecutive

Financial Officer

Priscilla Popov

Chief Financial Officer

Option Awards Column in the table above reflects the aggregate grant date fair value of the award granted in the year noted.

see Options/SAR Grants in the Last Fiscal Year below for more information relating to this option grant.

TO SUMMARY COMPENSATION TABLE

this time, we do not have an employment agreement with Saagar Govil or Paul J.

Wyckoff, though the Company may enter into such an agreement

with them on terms and conditions usual and customary for the industry.

All amounts paid to our officers in fiscal year end 2022 were

approved by the Company’s board of directors.

Chairman od the Board

Chief Executive Officer, and President

Interim Chief Financial Officer

Christopher C.

Former Chief Financial Officer

The Option Awards Column in the table above reflects the aggregate grant date fair value of the award granted in the year noted.

Please see Options/SAR Grants in the Last Fiscal Year below for more information relating to this option grant.

Other compensation are amounts paid by the company for medical, dental, vision, and life insurance benefits.

NARRATIVE TO SUMMARY COMPENSATION TABLE

At this time, we do not have an

employment agreement with Saagar Govil or Paul J.

Wyckoff, though the Company may enter into such an agreement with them on terms and

conditions usual and customary for the industry.

All amounts paid to our officers in fiscal year end 2023 were approved by the Company’s

board of directors.

The Company does not currently have “key man” life insurance on Mr.

GRANTS IN THE LAST FISCAL YEAR

April 28, 2022, the Company granted Brian Kwon, Manpreet Singh, Chris Wagner, and Metodi Filipov, all Directors of the Company, stock

options for 102,565 shares each, 410,260 in the aggregate.

These options have an exercise price of $0.39 per share, which vest over one

year, and expire after five years.

OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION/SAR VALUES

EQUITY AWARDS AT FISCAL YEAR-END

following table presents information regarding our NEOs’ unexercised options to purchase Common Stock as of September 30, 2022:

of Securities

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

following table sets forth certain information known to us with respect to the beneficial ownership of our common stock as of December

23, 2022, by:

persons who are beneficial owners of five percent (5%) or more of our common stock;

of our directors;

of our executive officers;

current directors and executive officers as a group.

as otherwise indicated, and subject to applicable community property laws, the persons named in the table below have sole voting and

investment power with respect to all shares of common stock held by them.

of December 23, 2022, 27,778,856 shares of Common Stock were issued and outstanding.

In addition, there were 50,000 shares of Series

C Preferred Stock outstanding which are entitled to vote 278,066,349 shares in the aggregate, all of which is held by Saagar Govil and

PAY VERSUS PERFORMANCE

Summary Compensation Table Total for

Compensation Actually Paid to PEO

Average Summary Compensation Table Total

for Non-PEO NEOs

Average Compensation Actually Paid to

Value of Initial Fixed $100 Investment

Based On Total Shareholder Return

$ (9,233,438 )

$ (13,292,242 )

dollar amounts reported in column (b) are the amounts reported for Saagar Govil, Chairman

of the Board, CEO, President and Secretary, for each of the corresponding years in the “Total”

column of the in our Summary Compensation Table.

Refer to the Summary Compensation Table above.

dollar amounts reported in column (c) represent the amount of “compensation actually

Govil, as computed in accordance with Item 402(v) of Regulation S-K and

do not reflect the total compensation actually realized or received by Mr.

In accordance

with these rules, these amounts reflect “Total Compensation” as set forth in

the Summary Compensation Table for each year, adjusted as shown below.

Equity values are

calculated in accordance with FASB ASC Topic 718, and the valuation assumptions used to calculate

fair values did not materially differ from those disclosed at the time of grant.

dollar amounts reported in column (d) represent the average of the amounts reported for our NEOs as a group (excluding Mr.

in the “Total” column of the Summary Compensation Table in each applicable year.

The names of each of the NEOs included

for these purposes in each applicable year are as follows:

Wyckoff, Interim Chief Financial Officer;

Christopher Moore, Chief

Financial Officer.

dollar amounts reported in column (e) represent the average amount of “compensation actually paid” to the NEOs as a group

(excluding Mr.

Govil), as computed in accordance with Item 402(v) of Regulation S-K.

In accordance with these rules, these amounts

reflect “Total Compensation” as set forth in the Summary Compensation Table for each year, adjusted as shown below.

Shareholder Return (TSR) is calculated by dividing (a) the difference between our share price at the end of each fiscal year shown

and the beginning of the measurement period, and the beginning of the measurement period by (b) our share price at the beginning

of the measurement period.

The beginning of the measurement period for each year in the table is September 30, 2021.

dollar amounts reported represent the amount of net income reflected in our audited financial statements for the applicable year.

to Determine Compensation “Actually Paid” for [PEO][Non-PEO NEOs]

for Change in the Actuarial Present values reported under the “Change in Pension Value and Nonaualified Deferred Comoensation

Earnimrn”‘ Column of the SCT

for “Service Cost” for Pension Plans

for “Prior Service Cost” for Pension Plans

for Amounts Reported under the “Stock Awards,, Column in the SCT

for Amounts Reported under the “Option Awards,, Column in the SCT

for Fair Value of Awards Granted during year that Remain Unvested as of Year end

for Fair Value of Awards Granted during year that vest during vear

Increase/deduction

for Change in Fair value from prior Year-end to current Year-end of Awards Granted Prior to year that were Outstanding and Unvested

as of Year-end

$ (1,948.00 )

$ (53,747.00 )

Increase/deduction

for Change in Fair Value from Prior Year-end to Vesting Date of Awards Granted Prior to year that Vested during year

$ (2,207.00 )

$ (29,381.00 )

of Fair value of Awards Granted Prior to year that were Forfeited during year

based upon Incremental Fair Value of Awards Modified during year

based on Dividends or Other Earnings Paid durilling year prior to Vesting Date of Award

$ (4,155.00 )

$ (83,128.00 )

OPTIONS/SAR GRANTS IN THE LAST FISCAL YEAR

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR

END OPTION/SAR VALUES

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END

The following table presents information regarding our NEOs’ unexercised

options to purchase Common Stock as of September 30, 2023:

Option Awards

Number of Securities Underlying Unexercised Options Exercisable

Option Exercise Price

Option Expiration Date

SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth

certain information known to us with respect to the beneficial ownership of our common stock as of December 26, 2023, by:

all persons who are

beneficial owners of five percent (5%) or more of our common stock;

each of our directors;

each of our executive

all current directors

and executive officers as a group.

Except as otherwise indicated,

and subject to applicable community property laws, the persons named in the table below have sole voting and investment power with respect

to all shares of common stock held by them.

As of December 26,

2023, 1,055,636 shares of Common Stock were issued and outstanding.

In addition, there were 50,000 shares of Series C Preferred

Stock outstanding which are entitled to vote 10,566,916 shares in the aggregate, all of which is held by Saagar Govil and 2,343,953

shares of Series 1 Preferred Stock outstanding which are entitled to vote 4,687,906 shares in the aggregate.

Accordingly, a

total of 310,083,931 shares may be voted at the Annual Meeting.

ownership is determined in accordance with the rules of the SEC.

In computing the number of shares beneficially owned by a person and

the percentage ownership of that person, shares of common stock subject to options held by that person that are currently exercisable

or exercisable within 60 days of December 23, 2022, are deemed outstanding.

Such shares, however, are not deemed as of December 23, 2022,

outstanding for the purpose of computing the percentage ownership of any other person.

Accordingly, there are

a total of 16,310,458 shares outstanding.

Beneficial ownership is determined in accordance with

the rules of the SEC.

In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares

of common stock subject to options held by that person that are currently exercisable or exercisable within 60 days of December 26, 2023,

are deemed outstanding.

Such shares, however, are not deemed as of December 26, 2023, outstanding for the purpose of computing the percentage

ownership of any other person.

Beneficial Owner

13 unchanged sentences

Greenpoint Avenue, Suite 208

directors and executive officers

a group (3 persons)

than one percent of outstanding shares.

as otherwise noted herein, the percentage is determined on the basis of 27,778,856 shares of our Common Stock outstanding plus securities

deemed outstanding pursuant to Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange

Under Rule 13d-3, a person is deemed to be a beneficial owner of any security owned by certain family members and any

security of which that person has the right to acquire beneficial ownership within 60 days, including, without limitation, shares

of our common stock subject to currently exercisable options.

percentage is based on the 27,778,856 shares of our Common Stock outstanding, the 278,066,349 votes that the Series C Preferred Stock

is entitled to vote, and the 4,238,726 votes that the Series 1 Preferred Stock is entitled to vote based on 2 votes per share.

to the Certificate of Designation of the Series C Preferred Stock, each issued and outstanding share of Series C Preferred Stock

are entitled to the number of votes per share equal to the result of (i) the total number of shares of Common Stock outstanding at

the time of such vote multiplied by 10.01, and divided by (ii) the total number of shares of Series C Preferred Stock outstanding

at the time of such vote, at each meeting of our shareholders with respect to any and all matters presented to our shareholders for

their action or consideration, including the election of directors.

of actual amount of Common Stock, Series C, and Series 1 Preferred Stock owned.

As described above each share of Series C is entitled

to 5,561.33 votes.

directors and executive officers as a group (3 persons)

Less than one percent of outstanding shares.

Except as otherwise noted herein, the percentage is determined on the basis of 1,055,636 shares of our Common Stock outstanding plus securities deemed outstanding pursuant to Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Under Rule 13d-3, a person is deemed to be a beneficial owner of any security owned by certain family members and any security of which that person has the right to acquire beneficial ownership within 60 days, including, without limitation, shares of our common stock subject to currently exercisable options.

This percentage is based on the 1,055,636 shares of our Common Stock outstanding, the 10,566,916 votes that the Series C Preferred Stock is entitled to vote, and the 4,687,906 votes that the Series 1 Preferred Stock is entitled to vote based on 2 votes per share.

Pursuant to the Certificate of Designation of the Series C Preferred Stock, each issued and outstanding share of Series C Preferred Stock are entitled to the number of votes per share equal to the result of (i) the total number of shares of Common Stock outstanding at the time of such vote multiplied by 10.01, and divided by (ii) the total number of shares of Series C Preferred Stock outstanding at the time of such vote, at each meeting of our shareholders with respect to any and all matters presented to our shareholders for their action or consideration, including the election of directors.

Consists of actual amount of Common Stock, Series C, and Series 1 Preferred Stock owned.

As described above each share of Series C is entitled to 211.33832 votes.

Series 1 Preferred Stock is entitled to 2 votes per share.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

from the following, there have been no transactions since October 1, 2020 to which we have been a party, including transactions in which

the amount involved in the transaction exceeds the lesser of $120,000 or 1% of the average of our total assets at year-end for the last

two completed fiscal years, and in which any of our directors, executive officers or, to our knowledge, beneficial owners of more than

5% of our capital stock or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material

interest, other than equity and other compensation, termination, change in control and other arrangements, which are described elsewhere

in this Annual Report on Form 10-K.

On August 31, 2019, the Company

entered into an Asset Purchase Agreement for the sale of Griffin Filters, LLC to Ducon Technologies, Inc., which Aron Govil, the Company’s

Founder and former CFO, for total consideration of $550,000.

As of September 30, 2022, and September 30, 2021, there was $19,133 payable

due to Ducon Technologies, Inc.

and $1,487,155 in receivables due from Ducon Technologies, Inc., respectively.

The Company has negotiated

a payment agreement surrounding the sale of Griffin Filters, LLC and other liabilities due to Cemtrex, Inc.

CERTAIN RELATIONSHIPS AND

RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

Aside from the following, there

have been no transactions since October 1, 2021 to which we have been a party, including transactions in which the amount involved in

the transaction exceeds the lesser of $120,000 or 1% of the average of our total assets at year-end for the last two completed fiscal

years, and in which any of our directors, executive officers or, to our knowledge, beneficial owners of more than 5% of our capital stock

or any member of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest, other than

equity and other compensation, termination, change in control and other arrangements, which are described elsewhere in this Annual Report

on Form 10-K.

As of September 30, 2023, and

September 30, 2022, there was $3,806 and $19,133, respectively, payable due to Ducon Technologies, Inc., which is controlled by Aron Govil,

the Company’s Founder and Former Director and CFO.

As of September 30, 2023, there were $638,410 of receivables due from Ducon Technologies,

The Company has negotiated a payment agreement regarding past receivables and other liabilities due to Cemtrex, Inc.

totaling $761,585.

This agreement

is in the form of a secured promissory note earning interest at a rate of 5% per annum and matures on July 31, 2024.

Receivables due as

of September 30, 2022, of $708,512 represents the amount due from Ducon to Cemtrex Technologies Pvt.

the Company’s subsidiary

based in India has been written off to bad debt and appears on the Company’s consolidated statements of operations and comprehensive

income/(loss) under general and administrative expenses.

February 23, 2021, Cemtrex’s Board of Directors determined that certain transactions between Cemtrex Inc.

and First Commercial,

a company owned by former Executive Director, former Controlling Shareholder and former CFO, Aron Govil, were incorrectly handled and

accounted for.

total amount of disputed transfers was approximately $7,100,000 and occurred in fiscal year 2017 in the amount of $5,600,000 and in fiscal

year 2018 in the amount of $1,500,000.

Cemtrex did not find any other such transfers during this period or thereafter, upon further review

of the Company’s records.

the Company’s investigation into this matter, the Company has determined that there were inaccuracies in the Company’s financial

The financials for the periods 2017 and 2018 were incorrect corresponding to the amounts that were incorrectly accounted

for, and subsequent years were affected by the roll forward effects of these entries.

The Company found unsupported advertising expenses

in the amount of approximately $400,000 on Cemtrex Inc’s income statement for fiscal year 2018 and found that approximately $5,700,000

of intangible assets and $975,000 of research and development expenses, as translated from Indian Rupee at the time, were recorded on

Cemtrex India’s financial statements in fiscal year 2018 and could not be substantiated.

The total amount of unsubstantiated transfers

recorded by Cemtrex India, and the unsupported advertising expense recorded by Cemtrex, Inc.

sums to $7,100,000, corresponding with the

total amount in question regarding First Commercial transfers during fiscal years 2017 and 2018

February 26, 2021, the Company entered into a Settlement Agreement and Release with Aron Govil regarding these transactions.

part of the Settlement Agreement, Mr.

Govil was required to pay the Company consideration with a total value of $7,100,000 (the “Settlement

Amount”) by entering into the Agreement.

This agreement is in the form of a secured promissory note earning interest at a rate of 5% per annum and matures on July 31, 2024.

due of $708,512, which represents the amount due from Ducon to Cemtrex Technologies Pvt.

the Company’s subsidiary based in

India had been written off to bad debt during fiscal year 2022 and appears on the Company’s consolidated statements of operations

and comprehensive income/(loss) under general and administrative expenses.

On February 26, 2021, the Company

entered into a Settlement Agreement and Release with Aron Govil regarding a dispute over an alleged misappropriation of funds.

As part of the Settlement Agreement,

Govil was required to pay the Company consideration with a total value of $7,100,000 (the “Settlement Amount”) by entering

into the Agreement.

The Settlement Amount was satisfied in a combination of Mr.

Govil forfeiting certain Preferred

Stock and outstanding options and executing a secured note in the amount of $1,533,280.

The Independent Board of Directors in coordination

with Management concluded the settlement represented fair value.

March 2021, Mr.

Govil returned to the Company 1,000,000 shares of Series A Preferred Stock, 50,000 Shares of Series C Preferred Stock,

469,949 shares of Series 1 Preferred Stock, and forfeited all outstanding options to purchase shares of commons stock (collectively,

the “Securities”).

For the purposes of accounting recognition, the Company determined the fair value of the Series A, Series

C, and Series 1 Preferred stock based on the closing trading value of the Series 1 Preferred Stock on the date of the agreement.

options surrendered were valued using the Black-Scholes option pricing model.

Company recognized the gain with respect to the surrendered Securities during the second quarter of fiscal year 2021.

The gain of $3,674,165

is reported as Settlement Agreement – Related Party on the Company’s Consolidated Statements of Operations and

Comprehensive Income/(Loss).

discussed above, Mr.

Govil also executed a secured promissory note (the “Note”) in the amount of $1,533,280.

The Note matures

and is due in full in two years and bears interest at 9% per annum and is secured by all of Mr.

Govil forfeiting certain Preferred Stock and outstanding

options and executing a secured note in the amount of $1,533,280.

The Independent Board of Directors in coordination with Management concluded

the settlement represented fair value.

As discussed above, Mr.

also executed a secured promissory note (the “Note”) in the amount of $1,533,280.

The Note matures and is due in full in two

years and bears interest at 9% per annum and is secured by all of Mr.

Govil’s assets.

agreed to sign an affidavit confessing judgment in the event of a default on the Note.

While the Company believes the note is fully collectible,

in accordance with ASC 450-30, Gain Contingencies, the Company determined the gain will not be recognized until the note is paid.

the note and associated gain is not presented on the Company’s Consolidated Balance Sheets and Consolidated

Statements of Operations and Comprehensive Income/(Loss).

PRINCIPAL ACCOUNTANT FEES AND SERVICES

following table sets forth the aggregate fees billed to the Company for the years ended September 30, 2022 and 2021 by Grassi Co.

Public Accountants the Company’s independent auditor:

Govil also agreed to sign an affidavit

confessing judgment in the event of a default on the Note.

While the Company believes the note is fully collectible, in accordance with

ASC 450-30, Gain Contingencies, the Company determined the gain will not be recognized until the note is paid.

Accordingly, the note and

associated gain is not presented on the Company’s Consolidated Balance Sheets and Consolidated Statements of Operations and Comprehensive

Income/(Loss).

On November 22, 2022, the Company

entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO,

Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include the brand SmartDesk, and Cemtrex

XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr.

Due to the on-going losses and

risk associated with the SmartDesk business the Company has valued the royalty and SAFE agreement associated with the SmartDesk sale at

$0 and considers such consideration to be a gain contingency.

Based on sales projections for

Cemtrex XR, Inc., the Company does not believe that it will exceed the sales levels required to exceed the $820,000 royalties due and

has not accounted for any additional royalties at this time.

In accordance with ASC 310 – Receivables, the Company has discounted

the royalties due and during the year ended September 30, 2023, has recognized $704,893 of royalties due and will amortize the remaining

amount over the period the royalties are due.

As of September 30, 2023, there

was $528,717 in trade receivables due from these companies and $64,703 in accounts payables.

Of these receivables $132,102 are related

to costs paid by Cemtrex related to payroll during the transition of employees to the new company and some subscription services that

are set up on auto pay with a credit card.

The remaining $396,615 is related to services provided by Cemtrex Technologies Pvt.

the normal course of business.

During Fiscal year 2023, the Company recognized $1,522,102 of revenue from these companies.

During fiscal

year 2023, $38,027 of trade receivables were reserved for by the Company’s subsidiary Cemtrex Technologies Pvt.

Due to regulations

by the Indian tax authority.

The Company will keep this allowance in place but considers the debt to be collectable.

These balances are

presented on the Consolidated Balance Sheets under the captions “Trade receivables - related party” and “Accounts payable

- related party”.

PRINCIPAL ACCOUNTANT FEES

The following table sets

forth the aggregate fees billed to the Company for the years ended September 30, 2023, and 2022 by Grassi & Co.

Certified Public

Accountants the Company’s independent auditor:

Audit-Related Fees

AND FINANCIAL STATEMENTS

Audit fees principally include

fees for the audit of our consolidated financial statements included in our annual report on Form 10-K and the review of financial statements

included in our quarterly reports on Form 10-Q.

Audit-related fees consist of

fees for other attestation and related services that are reasonably related to the performance of the audit or review of our financial

For fiscal year 2023, these fees primarily related to the audit of the historical financials of Heisey Mechanical, Ltd..

fiscal year 2022, these fees primarily related to providing consent to various company filings with the Securities and Exchange Commission.

Tax fees consist of tax compliance

EXHIBITS AND FINANCIAL

Statements and Notes to the Consolidated Financial Statements

Index to Consolidated Financial Statements on page F-1 at beginning of attached financial statements.

Purchase Agreement regarding the stock of Advanced Industrial Services, Inc., AIS Leasing Company, AIS Graphic Services, Inc., and

AIS Energy Services, LLC, Dated December 15, 2015.

Purchase agreement between Periscope GmbH and ROB Centrex Assets UG, ROB Cemtrex Automotive GmbH, and ROB Cemtrex Logistics GmbH.

See Index to Consolidated

Financial Statements on page F-1 at beginning of attached financial statements.

Stock Purchase Agreement regarding the stock of Advanced

Industrial Services, Inc., AIS Leasing Company, AIS Graphic Services, Inc., and AIS Energy Services, LLC, Dated December 15, 2015.

of Incorporation of the Company.(1)

12 unchanged sentences

of Correction of Certificate of Incorporation, dated July 29, 2021, filed October 7, 2020 (9)

Certificate of Amendment of Certificate of Incorporation, dated January 12, 2023 (7)

of Subscription Rights Certificate.

2 unchanged sentences

of Common Stock Purchase Warrant, dated March 22, 2019.

of the Term Loan Agreement between Vicon and NIL Funding, dated March 4, 2020.(17)

Agreement, dated April 22, 2020 between Centrex, Inc.

and Adtron, Inc.

Purchase Agreement dated June 1, 2020 (18)

Purchase Agreement dated June 9, 2020 (19)

Agreement and Release between Cemtrex, Inc.

Description of Registrant’s Securities

Amendment of the Term Loan Agreement between Vicon and NIL Funding, dated March 3, 2023.

Amendment to Loan Documents Between Advanced Industrial Services, Inc.

and Fulton Bank, N.A.

dated February 24, 2023 (5)

Amendment to Promissory Note Between Cemtrex, Inc.

and Streeterville Capital, LLC dated May 3, 2023 (5)

Securities Purchase Agreement dated June 1, 2020 (18)

Securities Purchase Agreement dated June 9, 2020 (19)

Settlement Agreement and Release between Cemtrex, Inc.

and Aron Govil dated February 26, 2021 (13)

Purchase Agreement dated February 22, 2022 (15)

of the Term Loan Agreement between Vicon and NIL Funding, dated March 30, 2022.

Code of Business Ethics.(4)

of the Registrant

of Grassi & Co, CPAs, P.C., Independent Registered Public Accounting Firm

Certification

of Chief Executive Officer as required by Rule 13a-14 or 15d-14 of the Exchange Act, as adopted Pursuant to Section 302 of the Sarbanes-Oxley

Certification

of Interim Chief Financial Officer and Principal Financial Officer as required by Rule 13a-14 or 15d-14 of the Exchange Act, as adopted

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification

of Chief Executive Officer Pursuant to 18 U.S.C.

Securities Purchase Agreement dated February 22, 2022 (15)

Amendment of the Term Loan Agreement between Vicon and NIL Funding, dated March 30, 2022.

Asset Purchase agreement between Cemtrex, Inc.

and Saagar Govil, dated November 22, 2022 (22)

Asset Purchase agreement between Cemtrex, Inc.

and Saagar Govil, dated November 22, 2022 (22)

Simple Agreement for Future Equity (SAFE) between Cemtrex, Inc.

and Saagar Govil, dated November 18, 2022 (22)

Amendment of the Term Loan Agreement between Vicon and NIL Funding, dated March 3, 2023 (23)

Amendment to Loan Documents Between Advanced Industrial Services, Inc.

and Fulton Bank, N.A.

Amendment to Promissory Note Between Cemtrex, Inc.

and Streeterville Capital, LLC (23)

Asset Purchase agreement between Cemtrex, Inc.

and Saagar Govil, dated November 22, 2022 (22)

Asset Purchase agreement between Cemtrex, Inc.

and Saagar Govil, dated November 22, 2022 (22)

Simple Agreement for Future Equity (SAFE) between Cemtrex, Inc.

and Saagar Govil (22)

Asset Purchase Agreement, dated as of June 7, 2023, by and among Heisey Mechanical, Ltd., a Pennsylvania corporation (“Seller”), and Andreas Heisey, an individual residing in the Commonwealth of Pennsylvania (“the “Shareholder” and collectively with the Seller, the “Seller Parties”) and Advanced Industrial Services, Inc., a Pennsylvania corporation (“Buyer”).

Corporate Code of Business Ethics.(4)

Subsidiaries of the Registrant

Consent of Grassi & Co, CPAs, P.C., Independent Registered Public Accounting Firm

Certification of Chief Executive Officer as required by Rule 13a-14 or 15d-14 of the Exchange Act, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of Interim Chief Financial Officer and Principal Financial Officer as required by Rule 13a-14 or 15d-14 of the Exchange Act, as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

Certification of Chief Executive Officer Pursuant to 18 U.S.C.

1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act 0f of 2002.

Certification

of Interim Chief Financial Officer and Principal Financial Officer Pursuant to 18 U.S.C.

1350, as adopted pursuant to Section 906

of the Sarbanes-Oxley Act 0f of 2002.

pursuant to Section 8A of the Securities Act – dated September 30, 2022.

XBRL Instance Document

XBRL Taxonomy Extension Schema

XBRL Taxonomy Extension Calculation Linkbase

XBRL Taxonomy Extension Definition Linkbase

XBRL Taxonomy Extension Label Linkbase

XBRL Taxonomy Extension Presentation Linkbase

Page Interactive Data File (embedded within the Inline XBRL document)

by reference from Form 10-12G filed on May 22, 2008.

by reference from Form 8-K filed on September 10, 2009.

by reference from Form 8-K filed on August 22, 2016.

by reference from Form 8-K filed on July 1, 2016.

by reference from Form S-8 filed on May 1, 2020

by reference from Form 8-K filed on June 12, 2019.

by reference from Form 8-K/A filed on November 24, 2017.

by reference from Form 8-K/A filed on September 26, 2016.

by reference from Form 10-Q filed on May 28, 2021.

by reference from Form S-1 filed on August 29, 2016 and as amended on November 4, 2016, November 23, 2016, and December 7, 2016.

by reference from Form 8-K filed on January 24, 2017.

by reference from Form 8-K filed on September 8, 2017.

by reference from Form 8-K filed on February 26, 2021.

by reference from Form 8-K filed on March 22, 2019.

by reference from Form 10-Q filed on May 16, 2022.

by reference from Form 8-K filed on April 1, 2020.

by reference from Form 8-K filed on March 9, 2020.

by reference from Form 8-K filed on June 4, 2020.

by reference from Form 8-K filed on June 12, 2020.

by reference from Form 10-K filed on January 5, 2021.

by reference from Form 8-K filed on October 4, 2022.

Certification of Interim Chief Financial Officer and Principal Financial Officer Pursuant to 18 U.S.C.

1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act 0f of 2002.

Order pursuant to Section 8A of the Securities Act – dated September 30, 2022.

Inline XBRL Instance Document

Inline XBRL Taxonomy Extension Schema

Inline XBRL Taxonomy Extension Calculation Linkbase

Inline XBRL Taxonomy Extension Definition Linkbase

Inline XBRL Taxonomy Extension Label Linkbase

Inline XBRL Taxonomy Extension Presentation Linkbase

Cover Page Interactive Data File (embedded within the

Inline XBRL document)

Filed herewith

Incorporated by reference from Form 10-12G filed on May 22, 2008.

Incorporated by reference from Form 8-K filed on September 10, 2009.

Incorporated by reference from Form 8-K filed on August 22, 2016.

Incorporated by reference from Form 8-K filed on July 1, 2016.

Incorporated by reference from Form 10-Q filed on May 11, 2023.

Incorporated by reference from Form 8-K filed on June 12, 2019.

Incorporated by reference from Form 8-K filed on January 20, 2023.

Incorporated by reference from Form 8-K/A filed on September 26, 2016.

Incorporated by reference from Form 10-Q filed on May 28, 2021.

Incorporated by reference from Form S-1 filed on August 29, 2016 and as amended on November 4, 2016, November 23, 2016, and December 7, 2016.

Incorporated by reference from Form 8-K filed on January 24, 2017.

Incorporated by reference from Form 8-K filed on September 8, 2017.

Incorporated by reference from Form 8-K filed on February 26, 2021.

Incorporated by reference from Form 8-K filed on March 22, 2019.

Incorporated by reference from Form 10-Q filed on May 16, 2022.

Incorporated by reference from Form 8-K filed on April 1, 2020.

Incorporated by reference from Form 8-K filed on March 9, 2020.

Incorporated by reference from Form 8-K filed on June 4, 2020.

Incorporated by reference from Form 8-K filed on June 12, 2020.

Incorporated by reference from Form 10-K filed on January 5, 2021.

Incorporated by reference from Form 8-K filed on October 4, 2022.

Incorporated by reference from Form 8-K filed on November 29, 2022.

Incorporated by reference from Form 10-Q filed on May 11, 2023.

Incorporated by reference from Form 8-K filed on December 6, 2023.

FORM 10-K SUMMARY

to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed

on its behalf by the undersigned, thereunto duly authorized.

Saagar Govil .

of the Board, CEO,

& Secretary (Principal Executive Officer)

CFO (Principal Financial and

to the requirements of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf

of the registrant and in the capacities and on the dates indicated.

Pursuant to the requirements of

Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the

undersigned, thereunto duly authorized.

CEMTREX, INC.

December 28, 2023

/s/ Saagar Govil

Chairman of the Board, CEO,

President and Secretary (Principal Executive Officer)

December 28, 2023

CFO (Principal Financial and Accounting Officer)

Pursuant to the requirements of

the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in

the capacities and on the dates indicated.

December 28, 2023

/s/ Saagar Govil

Saagar Govil,

of the Board, CEO,

& Secretary (Principal Executive Officer)

CFO (Principal Financial and

Chairman of the Board, CEO,

President and Secretary (Principal Executive Officer)

December 28, 2023

CFO (Principal Financial and Accounting Officer)

December 28, 2023

/s/ Brian Kwon

December 28, 2023

/s/ Manpreet Singh

Manpreet Singh,

December 28, 2023

/s/ Metodi Filipov

Metodi Filipov,

to the Consolidated Financial Statements

of Independent Registered Public Accounting Firm

Balance Sheets at September 30, 2022 and 2021

Statements of Operations and Comprehensive Income for the Fiscal Years Ended September 30, 2022 and 2021

Statements of Shareholders’ Equity for the Fiscal Years Ended September 30, 2022 and 2021

Statement of Cash Flows for Fiscal Years Ended September 30, 2022 and 2021

to the Consolidated Financial Statements

and Subsidiaries

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of Cemtrex, Inc.

Index to the Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets at September 30, 2023 and 2022

Consolidated Statements of Operations for the Fiscal Years Ended September 30, 2023 and 2022

Consolidated Statement of Comprehensive Loss for the Fiscal Years Ended September 30, 2023 and 2022

Consolidated Statements of Shareholders’ Equity for the Fiscal Years Ended September 30, 2023 and 2022

Consolidated Statement of Cash Flows for Fiscal Years Ended September 30, 2023 and 2022

Notes to the Consolidated Financial Statements

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING

the Board of Directors and

of Cemtrex, Inc.

and Subsidiaries

on the Financial Statements

We have audited the accompanying consolidated balance sheets of Cemtrex,

and Subsidiaries (the Company) as of September 30, 2022 and 2021, and the related consolidated statements of operations and comprehensive

income, stockholders’ equity, and cash flows for each of the years in the two-year period ended September 30, 2022, and the related

notes (collectively referred to as the financial statements).

In our opinion, the financial statements present fairly, in all material

respects, the financial position of the Company as of September 30, 2022 and 2021, and the results of its operations and its cash flows

for each of the years in the two-year period ended September 30, 2022, in conformity with accounting principles generally accepted in

the United States of America.

Substantial Doubt Regarding the Company’s

Ability to Continue as a Going Concern

The accompanying financial statements have been prepared assuming

that the Company will continue as a going concern.

As described in Note 1 to the financial statements, the Company has sustained net losses

and has significant short-term debt obligations, which raise substantial doubt about its ability to continue as a going concern.

plans in regard to these matters are described in Note 1.

The consolidated financial statements do not include any adjustments that might

result from the outcome of this uncertainty.

Our opinion is not modified with respect to this matter.

have audited the accompanying consolidated balance sheets of Cemtrex, Inc.

and Subsidiaries (the Company) as of September 30, 2023 and

2022, and the related consolidated statements of operations, comprehensive loss, stockholders’ equity, and cash flows for each

of the years in the two-year period ended September 30, 2023, and the related notes (collectively referred to as the financial statements).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of September

30, 2023 and 2022, and the results of its operations and its cash flows for each of the years in the two-year period ended September

30, 2023, in conformity with accounting principles generally accepted in the United States of America.

Doubt Regarding the Company’s Ability to Continue as a Going Concern

accompanying financial statements have been prepared assuming that the Company will continue as a going concern.

As described in Note

1 to the financial statements, the Company has sustained net losses and has significant short-term debt obligations, which raise substantial

doubt about its ability to continue as a going concern.

Management’s plans in regard to these matters are described in Note 1.

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Our opinion is not modified

with respect to this matter.

financial statements are the responsibility of the Company’s management.

30 unchanged sentences

of the matter

At September 30, 2022, the Company had approximately $4.5 million

As discussed in Note 1 to the consolidated financial statements, goodwill is tested annually for impairment at the reporting

unit level, or more frequently if impairment indicators arise.

In accordance with the FASB revised guidance on “Testing of Goodwill

for Impairment,” a company first has the option to assess qualitative factors to determine whether it is more likely than not that

the fair value of a reporting unit is less than its carrying amount.

If the company decides, as a result of its qualitative assessment,

that it is more-likely-than- not that the fair value of a reporting unit is less than its carrying amount, the quantitative impairment

test is mandatory.

Otherwise, no further testing is required.

The quantitative impairment test consists of a two-step goodwill impairment

The first step compares the fair value of each reporting unit to its carrying amount.

If the fair value of each reporting unit exceeds

its carrying amount, goodwill is not considered to be impaired and the second step will not be required.

If the carrying amount of a reporting

unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s

The implied fair value of goodwill is determined in a manner similar to accounting for a business combination with the allocation

of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit.

The excess of the fair value

of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill.

This allocation process

is only performed for purposes of evaluating goodwill impairment and does not result in an entry to adjust the value of any assets or

An impairment loss is recognized for any excess in the carrying value of goodwill over the implied fair value of goodwill.

Auditing the Company’s goodwill impairment analyses was complex

and highly judgmental due to the nature of qualitive assessment and, where necessary, the significant estimation required to determine

the fair value of the reporting units.

In particular, the fair value estimate was sensitive to significant assumptions, such as future

operating results, cash flows and the weighted average cost of capital.

These significant assumptions are forward looking and could be

materially affected by future market or economic conditions.

September 30, 2023, the Company had approximately $4.4 million of goodwill.

As discussed in Note 1 to the consolidated financial statements,

goodwill is tested annually for impairment at the reporting unit level, or more frequently if impairment indicators arise.

the Company’s goodwill impairment analyses was complex and highly judgmental due to the nature of qualitive assessment and, where

necessary, the significant estimation required to determine the fair value of the reporting units.

In particular, the fair value estimate

was sensitive to significant assumptions, such as future operating results, cash flows and the weighted average cost of capital.

significant assumptions are forward looking and could be materially affected by future market or economic conditions.

we addressed the matter

We obtained an understanding, evaluated the design and tested the

operating effectiveness of controls over the Company’s goodwill impairment evaluation process, including controls over management’s

obtained an understanding of controls over the Company’s goodwill impairment evaluation process, including controls over management’s

review of the significant assumptions described above.

Our audit procedures to test the Company’s goodwill impairment

analyses included evaluating the reasonableness of management’s qualitative assessments and in certain instances the estimated fair

value of the Company’s reporting units.

In evaluating estimated fair value of reporting units we, among others, evaluated management’s

significant assumptions described above and used within the fair value method, and tested the completeness and accuracy of the underlying

We engaged our valuation specialists to assist in assessing fair valuation methodologies utilized in the Company’s goodwill

impairment analyses.

We compared certain significant assumptions to existing market information and, where relevant, to the plans of the

Company, including management’s expectations with regard to the Company’s business model, customer base, product mix and other

relevant factors.

We assessed the historical accuracy of management’s projected cash flows, where applicable, and performed sensitivity

analyses of the significant assumptions to evaluate the changes in the fair value of the reporting units that would result from changes

in the assumptions.

We involved our valuation specialists to assist in evaluating the discount rates, which included comparison of the

selected discount rates to the Company’s weighted average cost of capital and the risk associated with projected cash flows.

we assessed the adequacy of the disclosures in the consolidated financial statements .

audit procedures to test the Company’s goodwill impairment analyses included evaluating the reasonableness of the Company’s

qualitative assessments and its estimated fair value of the reporting units.

In evaluating estimated fair value of reporting units we,

among other items, evaluated management’s significant assumptions described above and used within the fair value method, and tested

the completeness and accuracy of the underlying data.

We involved our valuation specialists to assist in assessing fair valuation methodologies

utilized in the Company’s goodwill impairment analyses and to assist in evaluating certain assumptions utilized in the analyses,

including discount rates..

We assessed the historical accuracy of management’s projected cash flows, where applicable, and performed

sensitivity analyses of the significant assumptions to evaluate the changes in the fair value of the reporting units that would result

from changes in the assumptions.

Finally, we assessed the adequacy of the disclosures in the consolidated financial statements.

Party Receivables

of the matter

As of September 30, 2022, the Company has approximately $9.5M of inventory.

As discussed in note 1, inventory is valued at the lower of cost or market.

The Company reduces inventory for the diminution of value,

resulting from product obsolescence, damage or other issues affecting marketability.

We determined valuation of inventory to be a critical

audit matter based on the high degree of management judgment necessary is assessing allowances for obsolesce.

September 30, 2023, the Company had approximately $2.6 million of related party receivables.

These receivables are made up of $1.1 million

of trade receivables, $0.8 million of a note receivable, and $0.7 million of royalty receivable.

The related party nature of these receivables

and associated disclosures are material to the financial statements and of a highly sensitive nature.

we addressed the matter

obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s inventory valuation

process, including controls over management’s review of the significant assumptions described above.

audit procedures included, physical observation of inventory in the Company’s warehouse locations, examined the company’s

analysis on a sample basis of parts of inventory in the context of the company’s valuation assertion, validating cost assertions

by review source documentation of inventory purchases, reviewing slow-moving reports provided by management, reviewing subsequent sales

data, retrospective review of prior year estimates, and analytical procedures including margin analyses.

obtained an understanding of controls over the Company’s accounting and disclosures for related party transactions.

audit procedures primarily included the following:

an understanding of certain related party transaction by reading relevant agreements, as

certain instance, obtaining confirmations from the related parties to affirm the existence

of the open receivable and personal guarantees, as applicable;

other audit procedures on certain open balances including, among other things, vouching to

invoices from the related parties and source documentation representing subsequent cash collections

of such receivables;

subledgers and documentation obtained in other audit areas for known related parties;

we evaluated the Company’s disclosures related to the matters described above.

& Co, CPAs, P.C.

Grassi & Co, CPAs, P.C.

have served as the Company’s auditor since 2021.

Auditor PCAOB ID Number 606

PCAOB ID Number 606

and Subsidiaries

BALANCE SHEETS

September 30,

Current assets

3 unchanged sentences

Trade receivables, net

Trade receivables - related

Inventory –net of

allowance for inventory obsolescence

expenses and other assets

Trade receivables - related party

Trade receivables, net

Inventory –net of allowance for inventory obsolescence

Contract assets

Prepaid expenses and other assets

Assets of discontinued operations

Total current assets

1 unchanged sentence

Right-of-use assets

Royalties receivable - related party

Note receivable - related party

& Stockholders’ Equity (Deficit)

Liabilities & Stockholders’ Equity

Current liabilities

1 unchanged sentence

Accounts payable - related party

Short-term liabilities

Accounts payable

Sales tax payable

Short-term liabilities, net of unamortized original issue discounts

Lease liabilities - short-term

1 unchanged sentence

Accrued expenses

Contract liabilities

Deferred revenue

Accrued income taxes

Liabilities of discontinued operations

Total current liabilities

5 unchanged sentences

Other long-term liabilities

Paycheck Protection Program

Revenue - long-term

long-term liabilities

Paycheck Protection Program Loans

Deferred Revenue - long-term

Total long-term liabilities

Total liabilities

Commitments and contingencies

Shareholders’ equity

Preferred stock , $ 0.001 par value, 10,000,000

shares authorized, Series 1, 3,000,000 shares authorized, 2,079,122 shares issued and 2,015,022 shares outstanding as of September

30, 2022 and 1,885,151 shares issued and 1,821,051 shares outstanding as of September 30, 2021 (liquidation value of $ 10 per share)

Series C, 100,000 shares authorized, 50,000

shares issued and outstanding at September 30, 2022 and September 30, 2021

Stockholders’ equity

Preferred stock , $ 0.001 par value, 10,000,000 shares authorized, Series 1, 3,000,000 shares authorized, 2,293,016 shares issued

and 2,228,916 shares outstanding as of September 30, 2023 and 2,079,122 shares issued and 2,015,022 shares outstanding as of

September 30, 2022 (liquidation value of $ 10 per share)

Series C, 100,000 shares authorized, 50,000 shares issued and outstanding at September 30, 2023 and September 30, 2022

Preferred stock, value

Common stock, $ 0.001 par value, 50,000,000

shares authorized, 26,413,296 shares issued and outstanding at September 30, 2022 and 20,782,194 shares issued and outstanding at

September 30, 2021

Common stock, $ 0.001 par value, 50,000,000 shares authorized, 1,045,789 shares issued and outstanding at September 30, 2023 and

754,711 shares issued and outstanding at September 30, 2022

Additional paid-in capital

Retained earnings (accumulated

Accumulated deficit

( 64,125,895 )

( 54,929,020 )

Treasury stock, 64,100

shares of Series 1 Preferred Stock at September 30, 2022 and 2021

other comprehensive income (loss)

Cemtrex stockholders’ equity

Non-controlling

liabilities and shareholders’ equity

Treasury stock, 64,100 shares of Series 1 Preferred Stock at September 30, 2023 and September 30,

Accumulated other comprehensive income

Total Cemtrex stockholders’ equity

Non-controlling interest

Total liabilities and stockholders’ equity

accompanying notes are an integral part of these consolidated financial statements.

and Subsidiaries

STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

the year ended

STATEMENTS OF OPERATIONS

For the year ended

September 30, 2023

September 30, 2022

Cost of revenues

2 unchanged sentences

Research and development

operating expenses

Goodwill impairment

Total operating expenses

Operating loss

( 1,511,508 )

( 14,129,115 )

Other income/(expense)

Settlement Agreement -

Related Party

Other (expense)/income

Other income, net

Interest expense

( 4,966,298 )

( 3,878,703 )

Total other income/(expense),

(loss)/income before income taxes

Total other (expense)/income, net

( 4,489,605 )

tax benefit/(expense)

(Loss)/Income from Continuing

Net loss before income taxes

( 6,001,113 )

Loss from discontinued

operations, net of tax

( 10,827,080 )

Income tax (expense)/benefit

Loss from Continuing operations

( 6,395,385 )

( 10,617,735 )

Less loss in noncontrolling

Loss from discontinued operations, net of tax

( 2,838,053 )

( 2,674,507 )

( 9,233,438 )

( 13,292,242 )

Less loss in noncontrolling interest

Net loss attributable to Cemtrex, Inc.

1 unchanged sentence

$ ( 13,020,958 )

Other comprehensive income/(loss)

Loss per share - Basic & Diluted

Continuing Operations

Discontinued Operations

Weighted Average Number of Shares-Basic & Diluted

and Subsidiaries

STATEMENT OF COMPREHENSIVE LOSS

For the year ended

September 30, 2023

September 30, 2022

Other comprehensive loss

$ ( 9,233,438 )

$ ( 13,292,242 )

Foreign currency translation

(loss)/income

benefit plan actuarial gain

Foreign currency translation gain/(loss)

Comprehensive loss

1 unchanged sentence

( 13,811,169 )

comprehensive loss attributable to noncontrolling interest

Less comprehensive income attributable to noncontrolling interest

Comprehensive loss attributable to Cemtrex, Inc.

1 unchanged sentence

$ ( 13,539,885 )

Income/(loss) Per Share-Basic

Income/(loss) Per Share-Diluted

Weighted Average Number of Shares-Basic

Weighted Average Number of Shares-Diluted

accompanying notes are an integral part of these consolidated financial statements.

and Subsidiaries

STATEMENTS OF SHAREHOLDERS’ EQUITY

STATEMENTS OF STOCKHOLDERS’ EQUITY

Preferred Stock

Treasury Stock,

64,100 shares of Series 1

Accumulated other

Comprehensive

3 unchanged sentences

$ ( 148,291 )

currency translation gain/(loss)

issued to pay notes payable

issued with note payable

paid in Series 1 preferred shares

Income/(loss)

attributable to noncontrolling interest

issued to pay for services

Foreign currency translation

Share-based compensation

Shares issued to pay notes

Dividends paid in Series 1

preferred shares

Income/(loss) attributable

to noncontrolling interest

Shares issued to pay for services

Additional rounding shares

issued for reverse stock split

( 9,196,875 )

2 unchanged sentences

$ ( 64,125,895 )

$ ( 148,291 )

accompanying notes are an integral part of these consolidated financial statements.

and Subsidiaries

STATEMENTS OF SHAREHOLDERS’ EQUITY

STATEMENTS OF STOCKHOLDERS’ EQUITY

Preferred Stock

Treasury Stock,

64,100 shares of Series 1

Accumulated other

Comprehensive

Stockholders’

at September 30, 2020, as restated

$ ( 34,100,067 )

$ ( 148,291 )

balance, value

$ ( 34,100,067 )

$ ( 148,291 )

currency translation gain/(loss)

benefit plan actuarial gain/(loss)

issued to pay notes payable

paid in Series 1 preferred shares

Income/(loss)

attributable to noncontrolling interest

and options surrendered in settelment agreement

( 1,000,000.00 )

at September 30, 2021

$ ( 41,908,062 )

$ ( 148,291 )

Foreign currency translation

Share-based compensation

Shares issued to pay notes

Shares issued with note payable

Dividends paid in Series 1

preferred shares

Income/(loss) attributable

to noncontrolling interest

Shares issued to pay for services

( 13,020,958 )

3 unchanged sentences

$ ( 148,291 )

balance, value

$ ( 41,908,062 )

$ ( 148,291 )

accompanying notes are an integral part of these consolidated financial statements.

1 unchanged sentence

STATEMENTS OF CASH FLOWS

For the twelve

Flows from Operating Activities

$ ( 13,292,242 )

$ ( 7,886,269 )

Net loss from discontinued

For the year ended

September 30,

Cash Flows from Operating Activities

$ ( 9,233,438 )

Net loss from continuing operations

$ ( 13,292,242 )

Adjustments to reconcile net income/(loss)

to net cash used by operating activities

Adjustments to reconcile net loss to net cash used by operating activities

Depreciation and amortization

Loss on disposal of property

and equipment

Loss on disposal of property and equipment

Noncash lease expense

Goodwill Impairment

Change in allowance for

doubtful accounts

Bad debt expense (recovery)

Loss on write off of related party receivables

1 unchanged sentence

Income tax expense/ (benefit)

Interest expense paid in

equity shares

Interest expense paid in equity shares

Accounts payable paid in equity shares

Accrued interest on notes

Amortization of original

issue discounts on notes payable

Gain on marketable securities

( 8,399,152 )

( 2,612,847 )

Discharge of Paycheck Protection

Program Loans

( 5,320,485 )

Settlement Agreement -

Related Party

Accrued interest on notes payable

Amortization of original issue discounts on notes payable

Gain/(loss) on marketable securities

( 8,399,152 )

Changes in operating assets and liabilities

net of effects from acquisition of subsidiaries:

Discharge of Paycheck Protection Program Loans

Changes in operating assets and liabilities net of effects from acquisition of subsidiaries:

Trade receivables

Trade receivables - related

( 3,795,964 )

Prepaid expenses and other

current assets

Trade receivables - related party

( 1,143,342 )

Other liabilities

( 3,731,742 )

Contract assets

Prepaid expenses and other current assets

Accounts payable

Accounts payable - related party

Sales tax payable

Operating lease liabilities

1 unchanged sentence

Accrued expenses

Contract liabilities

Deferred revenue

taxes payable

cash used by operating activities

Income taxes payable

Other liabilities

Net cash used by operating activities - continuing operations

( 4,724,305 )

( 16,262,531 )

Flows from Investing Activities

Net cash provided by operating activities - discontinued operations

Net cash used by operating activities

( 2,232,724 )

( 16,093,504 )

Cash Flows from Investing Activities

Purchase of property and equipment

3 unchanged sentences

Investment in MasterpieceVR

Investment in Virtual Driver Interactive

Acquisitions, Net of Cash Acquired

( 2,793,291 )

Proceeds from sale of marketable securities

Purchase of marketable

Purchase of marketable securities

( 19,901,897 )

Net cash (used in)/provided by investing activities - continuing operations

( 5,628,400 )

cash provided by investing activities

Flows from Financing Activities

Net cash used by investing activities - discontinued operations

Net cash (used in)/provided by investing activities

( 5,628,400 )

Cash Flows from Financing Activities

Proceeds from notes payable

Payments on notes payable

Proceeds on bank loans

Payments on debt

( 1,044,370 )

( 1,751,763 )

Payments on capital lease liabilities

Payments on Paycheck Protection Program Loans

Payments on bank loans

( 1,225,700 )

( 1,261,035 )

Proceeds from Paycheck Protection Program Loans

cash provided by financing activities

Net cash provided by financing activities

Effect of currency translation

Net decrease in cash, cash equivalents, and

restricted cash

Net decrease in cash, cash equivalents, and restricted cash

( 5,824,469 )

( 4,460,840 )

Cash, cash equivalents,

and restricted cash at beginning of period

cash equivalents, and restricted cash at end of period

Sheet Accounts Included in Cash, Cash Equivalents, and Restricted Cash

Cash and equivalents

cash, cash equivalents, and restricted cash

Less cash attributed to discontinued operations

Cash, cash equivalents, and restricted cash at beginning of period

Cash, cash equivalents, and restricted cash at end of period

accompanying notes are an integral part of these consolidated financial statements.

1 unchanged sentence

STATEMENTS OF CASH FLOWS

Disclosure of Cash Flow Information:

during the period for interest

Cash paid during the

period for income taxes

Balance Sheet Accounts Included in Cash, Cash Equivalents, and Restricted Cash

Cash and equivalents

Less cash attributed to discontinued operations

Restricted cash

Total cash, cash equivalents, and restricted cash

Supplemental Disclosure of Cash Flow Information:

Cash paid during the period for interest

Cash paid during the period for income taxes, net of refunds

$ ( 293,779 )

Schedule of Non-Cash Investing and Financing Activities

Investment in Virtual

Driver Interactive

Shares issued to pay

notes payable

Shares issued in connection

with note payable

Investment in right of

Supplemental Schedule of Non-Cash Investing and Financing Activities

Shares issued to pay for services

Shares issued to pay notes payable

Financing of building purchase

Financing of acquisition

Purchase of property and equipment through vendor financing

Shares issued in connection with note payable

Investment in right of use asset

accompanying notes are an integral part of these consolidated financial statements.

and Subsidiaries

TO CONSOLIDATED FINANCIAL STATEMENTS

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and its subsidiaries.

Impacts of COVID-19 on our Business

COVID-19 pandemic impacted our business operations and the results of our operations during fiscal years 2020 and 2021, primarily with

delays in orders by many customers and new product development, including newer versions of surveillance software since our technical

facility in Pune, India had been under lock down on multiple occasions.

Bookings and revenue have recovered in this calendar year compared

to last year.

However, due to ongoing delays in certain supply chain areas, the expected launch times of our new products and new versions

has resulted in delays of several months.

These supply chain issues have also affected the Company’s ability to obtain inventory

for our current bookings, and the Company has implemented a buildup of inventory levels to remain competitive and keep backlog orders

at a minimum.

Additionally, increased costs and the need to increase wages to retain talent may cause our gross margin percentages to

shrink and our operational costs to rise.

In response to these increased costs, the Company has implemented an ongoing review of our

pricing to cover these additional costs while remaining competitive.

broader implications of COVID-19 on our results from operations going forward remains uncertain.

The COVID-19 pandemic and the resulting

supply chain issues and inflation has the potential to cause adverse effects to our customers, suppliers or business partners in locations

that have or will experience more pronounced disruptions, which could result in a reduction to future revenue and manufacturing output

as well as delays in our new product development activities.

However, opportunities in the video surveillance field have been growing

for Vicon products.

extent of the pandemics effect on our operational and financial performance will depend in large part on future developments, which cannot

be reasonably estimated at this time.

Future developments include the emergence of new virus variants that are more contagious or harmful

than prior variants, the actions taken to contain or mitigate its impact both within and outside the jurisdictions where we operate,

the impact on governmental programs and budgets, the development of treatments or vaccines, and the resumption of widespread economic

Due to the inherent uncertainty of the unprecedented and rapidly evolving situation, we are unable to predict with any confidence

the likely impact of the COVID-19 pandemic on our future operations.

of former Cemtrex Brands

November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”)

with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include

the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech

(formerly Cemtrex Labs), to Mr.

November 22, 2022, the Company completed the above disposition for the following consideration.

comprised of:

in cash payable at Closing;

royalty of all revenues on the Business to be paid 90 days after the end of each calendar year for the next three years;

the total sum of royalties due be less than $ 820,000 at the end of the three-year period, Purchaser shall be obligated to pay the

difference between $ 820,000 and the royalties paid.

Advanced Technologies, Inc.

in cash payable at Closing;

royalty of all revenues on the Business to be paid 90 days after the end of each calendar year for the next 5 years ;

in SAFE (common equity) at any subsequent fundraising or exit above $5,000,000 with a $10,000,000 cap.

Company’s Board of Directors, excluding Saagar Govil who abstained from all voting on these agreements, approved these actions

and agreements.

of Heisey Mechanical

July 1, 2023, the Company under AIS, completed the acquisition of a leading service contractor and steel fabricator that specializes

in industrial and water treatment markets, Heisey Mechanical, Ltd.

(“Heisey”) based in Columbia, Pennsylvania.

estate of the business was purchased at fair market value on August 30, 2023, for $ 1,500,000

in a separate transaction.

provides the water treatment industry with a variety of fabricated vessels and equipment including ASME pressure vessels, heat exchangers,

mix tanks, reactors, and other specialized fabricated equipment.

Additionally, the contracting team assists with installation and service

of fabricated items.

The company has over 33,000 square feet of manufacturing floor space in its facility and an experienced staff of

fabricators, welders, and field mechanics.

purchase price allocation presented below is still preliminary but has been developed based on an estimate of fair values of Heisey’s

identifiable tangible and intangible assets acquired and liabilities assumed as of July 1, 2023.

The final allocation of the purchase

price will be determined within one year from the closing date of the Heisey acquisition.

consideration transferred and preliminary allocation of Heisey’s tangible and intangible assets and liabilities, are as follows:

OF BUSINESS ACQUISITION OF TANGIBLE AND INTANGIBLE ASSETS AND LIABILITIES

Consideration Transferred:

Seller’s note

Financed amount

Total consideration transferred

Purchase Price Allocation:

Contract assets

Machinery and equipment

Contract liabilities

Accrued expenses

Total consideration transferred

unaudited pro forma summary below presents the results of operations as if the Heisey acquisition occurred on October 1, 2021.

proforma adjustments for the twelve months ended September 30, 2023, includes $ 127,800

of depreciation expense from acquired fixed assets,

of interest expense on the debt used in the acquisition.

Unaudited proforma adjustments for the twelve months ended September 30, 2022, includes $ 255,600

of depreciation expense from acquired fixed assets,

of interest expense on the debt used in the acquisition.

The pro forma summary uses estimates and assumptions based on information available at the time.

Management believes the estimates and

assumptions to be reasonable; however, actual results may have differed significantly from this unaudited pro forma financial information.

The unaudited pro forma information does not reflect any cost savings, operating synergies or revenue enhancements that might have been

achieved from combining the operations.

OF PRO FORMA FINANCIAL INFORMATION

September 30, 2023

September 30, 2022

For the year ended

September 30, 2023

September 30, 2022

( 9,173,748 )

( 13,038,817 )

August 30, 2023, the Company acquired a mortgage in the amount of $ 1,200,000 from Fulton Bank to finance the purchase of the properties

formerly owned by Heisey Mechanical Ltd.

The mortgage carries interest at the Secured Overnight Financing Rate (SOFR) plus 2.8 % and matures

on September 30, 2043.

Stock Reverse Stock Split

January 25, 2023, the company completed a 35:1 reverse stock split on its common stock.

All share and per share data have been retroactively

adjusted for this reverse split.

of Delisting, Extension of cure period, and Subsequent Compliance

1 Preferred Stock

July 29, 2022, the Company received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”)

notifying the Company that, because the closing bid price for the Company’s Series 1 preferred stock listed on Nasdaq was below

$ 1.00 for 30 consecutive trading days, the Company no longer met the minimum bid price requirement for continued listing on The Nasdaq

Capital Market under Nasdaq Marketplace Rule 5550(a)(2), requiring a minimum bid price of $ 1.00 per share (the “Minimum Bid Price

Requirement”).

On January 26, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq

notifying the Company that, it had been granted an additional 180 days or until July 24, 2023, to regain compliance with the Minimum

Bid Price Requirement based on the Company meeting the continued listing requirement for market value of publicly held shares and all

other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s

written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

On September 8, 2023, Cemtrex Inc.

(the “Company”) received a letter from the Nasdaq Hearings Panel (“Panel”)

informing the Company that the Panel has granted the Company a temporary exception to regain compliance with The Nasdaq Stock Market

LLC’s (“Nasdaq” or the “Exchange”) Listing Rule 5555(a)(1) (the “Bid Price Rule”) by no later

than January 19, 2024.

The Company has announced a special meeting of Series 1 Preferred stock shareholders scheduled for December 26,

2023, to approve the reverse stock split.

January 24, 2022, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company

that, because the closing bid price for the Company’s common stock listed on Nasdaq was below $ 1.00 for 30 consecutive trading

days, the Company no longer met the minimum bid price requirement for continued listing on The Nasdaq Capital Market under Nasdaq Marketplace

Rule 5550(a)(2), requiring a minimum bid price of $ 1.00 per share (the “Minimum Bid Price Requirement”).

July 26, 2022, the Company received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC Nasdaq

notifying the Company that, it had been granted an additional 180 days or until January 23, 2023, to regain compliance with the Minimum

Bid Price Requirement based on the Company meeting the continued listing requirement for market value of publicly held shares and all

other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s

written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

January 26, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company

that it has not regained compliance with Listing Rule 5550(a)(2) and accordingly would be delisted from the Capital Market.

then requested and had been granted a hearing to occur on March 16, 2023, appealing this determination to a Hearings Panel (the “Panel”),

pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series.

February 8, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company

that it has regained compliance with Listing Rule 5550(a)(2) and is in compliance with all applicable listing standards.

The Company’s

common stock will continue to be listed and traded on The Nasdaq Stock Market.

Concern Considerations

16 unchanged sentences

the entity’s ability to continue as a going concern within one year after the date that the financial statements are issued.

The Company has incurred substantial losses of $ 13,020,958 and $ 7,807,995 for fiscal years 2022 and 2021, respectively, and has debt obligations

over the next fiscal year of $ 18,200,521 and working capital of $ 4,687,881 , that raise substantial doubt with respect to the Company’s ability

to continue as a going concern.

While our working capital

and current debt indicate a substantial doubt regarding the Company’s ability to continue as a going concern, the Company has historically,

from time to time, satisfied and may continue to satisfy certain short-term liabilities through the issuance of common stock, thus reducing

our cash requirement to meet our operating needs.

Additionally, the Company has recently sold unprofitable brands, reducing the cash required

to maintain those brands, reevaluated our pricing model on our Vicon brand to improve margins on those products, and is working to effect

Company has incurred substantial losses of $ 9,196,875 and $ 13,020,958 for fiscal years 2023 and 2022, respectively, and has debt obligations

over the next fiscal year of $ 14,507,711 and working capital of $ 1,948,923 , that raise substantial doubt with respect to the Company’s

ability to continue as a going concern.

the Company’s working capital and current debt indicate a substantial doubt regarding the Company’s ability to continue as

a going concern, the Company has historically, from time to time, satisfied and may continue to satisfy certain short-term liabilities

through the issuance of common stock, thus reducing our cash requirement to meet our operating needs.

Additionally, the Company has recently

sold unprofitable brands, reducing the cash required to maintain those brands, implemented a new pricing model on our Vicon brand which

has improved margins on those products, has refinanced some debt to provide the Company with additional capital when needed, has effected

a reverse stock split on our common stock to remain trading on the Nasdaq Capital Markets, and improve our ability to raise capital through

2 unchanged sentences

equity offerings and/or debt is satisfied with equity, it may have a dilutive effect on our existing stockholders.

While the Company believes

these plans are sufficient to meet the capital demands of our current operations for at least the next twelve months, the is no guarantee

that we will succeed.

Overall, there is no guarantee

that cash flow from our existing or future operations and any external capital that we may be able to raise will be sufficient to meet

our working capital needs.

We currently do not have adequate cash to meet our short or long-term needs.

The consolidated financial statements

do not include any adjustments relating to this uncertainty.

While the Company

believes these plans are sufficient to meet the capital demands of our current operations for at least the next twelve months, the is

no guarantee that we will succeed.

there is no guarantee that cash flow from our existing or future operations and any external capital that we may be able to raise will

be sufficient to meet our working capital needs.

The Company currently do not have adequate cash to meet our short or long-term needs.

The consolidated financial statements do not include any adjustments relating to this uncertainty.

with the Securities and Exchange Commission

17 unchanged sentences

text, to the businessperson at the other company responsible for that company’s relationship with the Company.

the Company received a civil monetary penalty of two million two hundred thousand dollars ($ 2,200,000 ) in the aggregate that must be

paid to the SEC.

the Company received a civil monetary penalty of two million two hundred thousand dollars ($ 2,200,000 ) in the aggregate that was paid

Govil also received a civil monetary penalty of three hundred and fifty thousand dollars ($ 350,000 ) in the aggregate

that must be paid to the SEC.

that was paid to the SEC.

The Company and Mr.

Govil have remitted the payments as of September 30, 2022.

The Company’s penalty

is presented on the Consolidated Statement of Operations under the heading “Other Income, net”.

The SEC Order can be accessed

16 unchanged sentences

Such estimates include,

but are not limited to, provisions for doubtful trade receivables, net realizable value of inventory, warranty obligations,

income tax accruals, deferred tax valuation and assessments of the recoverability of the Company’s long-lived assets.

Actual results

could differ from those estimates.

but are not limited to, provisions for doubtful trade receivables, net realizable value of inventory, warranty obligations, income tax

accruals, deferred tax valuation and assessments of the recoverability of the Company’s long-lived assets.

Actual results could

differ from those estimates.

of Consolidation

consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, Cemtrex Advanced Technologies Inc.,

Cemtrex XR Inc., Cemtrex Technologies Pvt.

Ltd., and Advanced Industrial Services, Inc.

and the Company’s majority owned subsidiary

Vicon Industries, Inc.

and its subsidiary, Vicon Systems, Ltd.

consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries, Cemtrex Technologies Pvt.

and Advanced Industrial Services, Inc.

and the Company’s majority owned subsidiary Vicon Industries, Inc.

and its subsidiary, Vicon

Systems, Ltd.

All inter-company balances and transactions have been eliminated in consolidation.

10 unchanged sentences

net book values of the long-lived assets are depreciated over the newly determined remaining estimated useful lives.

impairment charges, if any, is included in operating expenses in the accompanying statements of operations.

impairment charges, if any, is included in operating expenses in the accompanying consolidated statements of operations.

Company considers all highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents.

8 unchanged sentences

The Company determines when receivables are past due or delinquent based on how recently payments have been received.

Company reserved for $ 252,688

and $ 178,992

within its allowance for doubtful accounts at September 30, 2022, and 2021, respectively.

Company reserved $ 234,924 and $ 249,439 within its allowance for doubtful accounts at September 30, 2023, and 2022, respectively.

Company does no t have any off-balance-sheet credit exposure to its customers at September 30, 2023, or 2022.

and Cost of Goods Sold

Company values inventory, consisting of finished goods, at the lower of cost or market.

Cost is determined on the average cost method.

The Company reduces inventory for the diminution of value, resulting from product obsolescence, damage or other issues affecting marketability,

equal to the difference between the cost of the inventory and its estimated market value.

Factors utilized in the determination of estimated

market value include (i) current sales data and historical return rates, (ii) estimates of future demand, and (iii) competitive pricing

Company values inventory, consisting of finished goods, at the lower of cost or net realizable value.

Cost is determined on the average

The Company reduces inventory for the diminution of value, resulting from product obsolescence, damage or other issues affecting

marketability, equal to the difference between the cost of the inventory and its estimated market value.

Factors utilized in the determination

of estimated market value include (i) current sales data and historical return rates, (ii) estimates of future demand, and (iii) competitive

pricing pressures.

Company classifies inventory markdowns in the income statement as a component of cost of goods sold.

2 unchanged sentences

was $ 618,021 and $ 1,088,377 in inventory obsolescence reserve at September 30, 2023, and 2022, respectively.

The decrease in inventory

obsolescence is due to the sale and/or disposal of out-of-date products.

and Equipment

and equipment is recorded at cost.

and equipment are recorded at cost.

Expenditures for major additions and betterments are capitalized.

29 unchanged sentences

October 1, 2020.

the year ended September 30, 2022, an impairment of the Company’s goodwill of $ 3,316,000 was recorded and for the year ended September

30,2021, there was no impairment of the Company’s goodwill.

November 13, 2020, Cemtrex made a $ 500,000 investment and on January 19, 2022, made an additional $ 500,000 investment via a simple agreement

for future equity (“SAFE”) in MasterpieceVR.

The SAFE provides that the Company will automatically receive shares of the

entity based on the conversion rate of future equity rounds up to a valuation cap, as defined.

MasterpieceVR is a software company that

is developing software for content creation using virtual reality.

The investment is included in other assets in the accompanying balance

sheet and the Company accounts for this investment and recorded at cost.

No impairment has been recorded for the period ended June 30,

the year ended September 30, 2023, no impairment of the Company’s goodwill was recorded and for the year ended September 30,2022,

an impairment of the Company’s goodwill of $ 3,316,000 was recorded.

November 13, 2020, and January 19, 2022, Cemtrex made $ 500,000 investments and on July 18, 2023, and October 5, 2023, made additional

$ 100,000 investments via a simple agreement for future equity (“SAFE”) in MasterpieceVR.

The SAFE provides that the Company

will automatically receive shares of the entity based on the conversion rate of future equity rounds up to a valuation cap, as defined.

MasterpieceVR is a software company that is developing software for content creation using virtual reality.

The investment is included

in other assets in the accompanying consolidated balance sheet and the Company accounts for this investment and recorded at cost.

impairment has been recorded for the period ended September 30, 2023.

October 1, 2019, the Company adopted ASU 2016-02 (Topic 842), “Leases”.

25 unchanged sentences

and Contingencies

The Company follows topic Accounting

Standards Codification (“ASC”) Topic 450-20, Contingencies , to report accounting for contingencies.

Certain conditions

may exist as of the date the consolidated financial statements are issued, which may result in a loss to the Company, but which will only

be resolved when one or more future events occur or fail to occur.

The Company assesses such contingent liabilities, and such assessment

inherently involves an exercise of judgment.

In assessing loss contingencies related to legal proceedings that are pending against the

Company or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings

or unasserted claims as well as the perceived merits of the amount of relief sought or expected to be sought therein.

Company follows topic Accounting Standards Codification (“ASC”) Topic 450-20, Contingencies , to report accounting

for contingencies.

Certain conditions may exist as of the date the consolidated financial statements are issued, which may result in

a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur.

The Company assesses such

contingent liabilities, and such assessment inherently involves an exercise of judgment.

In assessing loss contingencies related to legal

proceedings that are pending against the Company or unasserted claims that may result in such proceedings, the Company evaluates the

perceived merits of any legal proceedings or unasserted claims as well as the perceived merits of the amount of relief sought or expected

to be sought therein.

the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability

10 unchanged sentences

transition method.

Management determined that there was no cumulative effect adjustment to the consolidated financial statements and

the adoption of the standard did not require any adjustments to the consolidated financial statements for prior periods.

Under the guidance

of the standard, revenue represents the amount received or receivable for goods and services supplied by the Company to its customers.

Company recognizes revenue at the time a good or service is transferred to a customer and the customer obtains control of that good or

receives the service performed.

Most of the Company’s sales arrangements with customers are short-term in nature involving single

performance obligations related to the delivery of goods or repair of equipment and generally provide for transfer of control at the

time of shipment to the customer.

The Company generally permits returns of product or repaired equipment due to defects;

however, returns

are historically insignificant.

Billing terms vary by customer and product but generally do not exceed 90 days.

Under the guidance of the standard, revenue represents the amount received or receivable for goods and services supplied

by the Company to its customers.

Company recognizes revenue at the time a good or service is transferred to a customer and the customer

obtains control of that good or receives the service performed.

Most of the Company’s sales arrangements with customers in the

Security segment are short-term in nature involving single performance obligations related to the delivery of goods or repair of equipment

and generally provide for transfer of control at the time of shipment to the customer.

The Company generally permits returns of product

or repaired equipment due to defects;

however, returns are historically insignificant.

Billing terms vary by customer and product but

generally do not exceed 90 days.

accordance with the authoritative guidance issued by the FASB on revenue recognition, the Company recognizes revenue from cost reimbursable

15 unchanged sentences

against the receivable recognized when those goods or services are delivered.

The amounts were $ 2,558,591 , and $ 2,472,137 , for the years

ended September 30, 2022, 2021 respectively, recorded at Deferred revenue.

Additionally, the company recorded Deposits from customers

of $ 198,178 , and $ 536,220 , for the years ended September 30, 2022, and 2021 respectively.

The amounts were $ 2,311,334 , and $ 1,788,507 , as of September

30, 2023, 2022 respectively, recorded at Deferred revenue.

Additionally, the company recorded Deposits from customers of $ 57,434 , and

$ 73,144 , as of September 30, 2023, and 2022 respectively.

Company’s industrial services segment’s revenue is derived from contracts with customers.

These contracts fall into two categories,

“Fixed Price” and “Time and Material Price” contracts.

The Company determines the appropriate accounting treatment

for each contract at its inception.

Generally, contracts have a period from six months to two years.

Company accounts for a contract when:

(i) it has approval and commitment from both parties, (ii) the rights of the parties are identified,

(iii) payment terms are identified, (iv) the contract has commercial substance, and (v) collectability of consideration is probable.

The Company considers the start of a project to be when the above criteria have been met and it has written authorization from the customer

price contracts

Company’s revenue from fixed price contracts is recognized on the percentage-of-completion method, measured by the percentage of

costs incurred to estimated total costs for each contract.

When the job is started and in process, all actual costs incurred (labor and

materials) are processed and reconciled at month end.

The percentage of completion and revenue earned is calculated at month end.

are created based on contract criteria agreed upon and reconciled to determine if any costs in excess of billing or billings in excess

of costs exist.

Changes in job performance, job conditions, estimated contract costs and profitability, and final contract settlements

may result in revisions to costs and income.

The effects of these revisions are recognized in the period in which the revisions are determined.

Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined.

This measurement

and comparison process requires updates to the estimate of total costs to complete the contract, and these updates may include subjective

assessments and judgments.

and material price contracts

from time and material price contracts is recognized based on costs incurred and projected markup on costs.

Revenue from these contracts

will vary based on actual labor, materials and overhead costs charged to the job and the negotiated billing rates.

Contracts are initiated

by customers or through bids if with a municipality.

Any materials used and time spent within the shop on the job is assigned to the

appropriate job and reconciliated monthly.

Management bills the customer and records the revenue earned from contract.

Depending on the

contract terms, billings could be based on certain milestones stipulated in the contract.

If this is the case, unbilled revenue is recorded

at month end based on time and materials incurred and markup.

the Company’s contracts contain one performance obligation.

A performance obligation is a promise in a contract to transfer a distinct

good or service to the customer and is the unit of account.

The Company’s performance of the contracts with customers typically

provides a significant service of integrating a complex set of tasks and components into a single project or capability (even if that

single project results in the delivery of multiple units), and as such, the entire contract and/or purchase order is accounted for as

one performance obligation.

The transaction price is allocated to the performance obligation and recognized as revenue when, or as, the

performance obligation is satisfied with the continuous transfer of control to the customer.

commonly, a contract may be considered to have multiple performance obligations even when they are part of a single contract.

For contracts

with multiple performance obligations, the Company allocates the transaction price to each performance obligation using the best estimate

of the standalone selling price of each distinct good or service in the contract.

Company recognizes revenue over time for the majority of the services it performs as (i) control continuously transfers to the customer

as work progresses at a project location controlled by the customer and (ii) the Company has the right to bill the customer as costs

are incurred.

Company provides for the estimated cost of product warranties at the time revenue is recognized.

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Income (Loss) per Common Share

net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock

outstanding during the period.

Diluted net income per common share is computed by dividing net income by the weighted average number

of shares of common stock and potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution

that could occur from common shares issuable through contingent share arrangements, stock options and warrants.

As of September 30, 2022,

and 2021, the following items were excluded from the computation of diluted net loss per common share as their effect is anti-dilutive:

net income (loss) per common share is computed by dividing net income (loss) less the fair market value of dividends declared by the

weighted average number of shares of common stock outstanding during the period.

Diluted net income per common share is computed by

dividing net income less the fair market value of dividends declared by the weighted average number of shares of common stock and

potentially dilutive outstanding shares of common stock during the period to reflect the potential dilution that could occur from

common shares issuable through contingent share arrangements, stock options and warrants.

As of September 30, 2023, and 2022, the

following items were excluded from the computation of diluted net loss per common share as their effect is anti-dilutive:

SCHEDULE OF COMPUTATION OF DILUTED NET LOSS PER COMMON SHARE AS ANTI-DILUTIVE EFFECT

For the twelve months ended

Warrants to purchase shares

For the years ended

September 30,

For the years ended September

30, 2023, and 2022 loss per share basic and diluted for continuing operations are calculated as follows;

SCHEDULE OF LOSS PER SHARE BASIC AND DILUTED

FOR CONTINUING OPERATIONS

the years ended

from Continuing operations

$ ( 6,395,385 )

$ ( 10,617,735 )

loss in noncontrolling interest

stock dividends

loss applicable to common shareholders

( 6,681,738 )

( 10,522,206 )

Average Number of Shares-Basic & Diluted

per share - Basic & Diluted - Continuing Operations

Currency Translation Gain and Comprehensive Income (Loss)

In countries in which the Company operates, and the functional currency is other than the U.S.

countries in which the Company operates, and the functional currency is other than the U.S.

dollar, assets and liabilities are translated

using published exchange rates in effect at the consolidated balance sheet date.

Revenues and expenses and cash flows are translated using an approximate weighted average exchange rate for the period.

Revenues and expenses and cash flows are translated

using an approximate weighted average exchange rate for the period.

Resulting translation adjustments are recorded as a component of

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For the years ending September 30, 2023, and September

30, 2021, comprehensive loss includes a loss of $ 518,927 and a gain of $ 996,100 , respectively, which were entirely from foreign currency

30, 2022, comprehensive loss includes a gain of $ 699,181 and a loss of $ 518,927 , respectively, which were entirely from foreign currency

of and for the year ended September 30, 2023, and 2022, the Company used the following exchange rates.

SCHEDULE OF FOREIGN CURRENCY EXCHANGE RATE

Approximate weighted

average exchange rate

Exchange rate at

For the year ended

Exchange rate at

For the year ended

Exchange rate at September 30, 2022

Approximate weighted average exchange rate For the year

ended September 30, 2022

Exchange rate at September 30, 2023

Approximate weighted average exchange rate For the year

ended September 30, 2023

Great Britain Pound

Reclassifications

Certain reclassifications have been made to prior period amounts to

conform to the current period presentation.

This had no effect on the Company’s statement of operations or retained earnings.

Flows Reporting

Company uses the indirect or reconciliation method (“Indirect method”) as to report net cash flow from operating

activities by adjusting net income to reconcile it to net cash flow from operating activities by removing the effects of (a) all deferrals

of past operating cash receipts and payments and all accruals of expected future operating cash receipts and payments and (b) all items

that are included in net income that do not affect operating cash receipts and payments.

The Company reports the reporting currency equivalent

of foreign currency cash flows, using the current exchange rate at the time of the cash flows and the effect of exchange rate changes

on cash held in foreign currencies is reported as a separate item in the reconciliation of beginning and ending balances of cash and

cash equivalents and separately provides information about investing and financing activities not resulting in cash receipts or payments

in the period.

reclassifications have been made to prior period amounts to conform to the current period presentation.

This had no effect on the Company’s

statement of operations or retained earnings.

The reclassifications center around the reclassification of the assets and liabilities of the Company’s discontinued

operations now under the headings “Assets of discontinued operations” and “Liabilities of discontinued operations”

on the Company’s Consolidated Balance Sheet and the operational results of the discontinued operations under the heading of “Loss

from discontinued operations, net of tax” on the Company’s Consolidated Statement of Operations.

of an Immaterial Error in Previously Issued Financial Statements

Subsequent to the issuance

of our financial statements for the year ended September 30, 2022, an immaterial error was identified and has been corrected in our historical

information related to the calculation of earnings per share.

The original calculation did not take into account the fair value of the

Series 1 Preferred Stock dividends declared during the period.

Additionally, as discussed above the amount of earnings per share for

discontinued operations was not presented.

The effects of the correction to the individual effected line items

in our Consolidated Statement of Operations are as follows:

SCHEDULE OF ERROR CORRECTIONS AND PRIOR PERIOD ADJUSTMENTS

September 30, 2022

As previously reported

Loss per share - Basic & Diluted

Continuing Operations

Discontinued Operations

Company accounts for business combinations under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification

(“ASC”) 805 “Business Combinations” using the acquisition method of accounting, and accordingly, the assets and

liabilities of the acquired business are recorded at their fair values at the date of acquisition.

The excess of the purchase price over

the estimated fair value is recorded as goodwill.

All acquisition costs are expensed as incurred.

Upon acquisition, the accounts and

results of operations are consolidated as of and subsequent to the acquisition date.

Issued Accounting Pronouncements Not Yet Effective

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from Contracts with Customers (“ASU No.

2021-08 will require companies to apply the definition of a

performance obligation under ASC Topic 606 to recognize and measure contract assets and contract liabilities (i.e., deferred revenue)

relating to contracts with customers that are acquired in a business combination.

2021-08 will require companies to apply the definition of a performance

obligation under ASC Topic 606 to recognize and measure contract assets and contract liabilities (i.e., deferred revenue) relating to

contracts with customers that are acquired in a business combination.

Under current U.S.

GAAP, an acquirer generally recognizes

assets acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue

contracts with customers, at fair value on the acquisition date.

2021-08 will result in the acquirer recording acquired contract

assets and liabilities on the same basis that would have been recorded by the acquiree before the acquisition under ASC Topic 606.

GAAP, an acquirer generally recognizes assets

acquired and liabilities assumed in a business combination, including contract assets and contract liabilities arising from revenue contracts

with customers, at fair value on the acquisition date.

2021-08 will result in the acquirer recording acquired contract assets

and liabilities on the same basis that would have been recorded by the acquiree before the acquisition under ASC Topic 606.

is effective for fiscal years beginning after December 15, 2022, with early adoption permitted.

We are currently evaluating

the impact of this ASU on our financial statements.

The Company has adopted this ASU as of October

1, 2022, and applied it to the Heisey Mechanical Ltd.

acquisition .

June 30, 2022, the FASB issued ASU 2022-03 Fair Value Measurement (Topic 820):

Fair Value Measurement of Equity Securities Subject

to Contractual Sale Restrictions (“ASU 2022-03”), which (1) clarifies the guidance in ASC 8202 on the fair value measurement

Fair Value Measurement of Equity Securities Subject to

Contractual Sale Restrictions (“ASU 2022-03”), which (1) clarifies the guidance in ASC 8202 on the fair value measurement

of an equity security that is subject to a contractual sale restriction and (2) requires specific disclosures related to such an equity

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after December 15, 2023, with early adoption permitted.

We are currently evaluating the impact of this ASU on our financial statements.

The Company is currently evaluating the impact of this ASU on our financial statements.

June 2016 the FASB issued ASU No.

Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses on Financial

Instruments, which makes significant changes to the accounting for credit losses on financial assets and disclosures about them.

guidance applies to a wide variety of financial assets including trade receivables and contract assets and is effective for the Company

for annual reporting periods beginning after December 15, 2022, and interim periods therein.

The new guidance on the current expected

credit loss (‘CECL”) impairment model requires an estimate of expected credit losses, measured over the contractual life

of an asset, that considers forecasts of future economic conditions in addition to information about past events and current conditions.

It requires entities to consider the risk of loss even if it is remote, which may result in the recognition of credit losses on assets

that do not have evidence of credit deterioration.

The Company is currently evaluating the impact

of this ASU on our financial statements.

November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures”

(“ASU 2023-07”), which enhances the disclosures required for operating segments in the Company’s annual and interim

consolidated financial statements.

ASU 2023-07 is effective for the Company for annual reporting for fiscal 2025 and for interim period

reporting beginning in fiscal 2026 on a retrospective basis.

Early adoption is permitted.

The Company is currently evaluating the impact

of our pending adoption of ASU 2023-07 on our consolidated financial statements.

Company does not believe that any other recently issued but not yet effective accounting pronouncements, if adopted, would have a material

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3 – SEGMENT AND GEOGRAPHIC INFORMATION

Company has two business segments, consisting of (i) Advanced Technologies (AT) and (ii) Industrial Services (IS).

Technologies (AT)

Advanced Technologies segment operates several brands that deliver cutting-edge software and hardware technologies:

Industries – Vicon Industries, a majority owned subsidiary, provides end-to-end video security solutions to meet the toughest

corporate, industrial and governmental security challenges.

Vicon’s products include browser-based video monitoring systems

and analytics-based recognition systems, cameras, servers, and access control systems for every aspect of security and surveillance

in industrial and commercial facilities, federal prisons, hospitals, universities, schools, and federal and state government offices.

Vicon provides cutting edge, mission critical security and video surveillance solutions utilizing Artificial Intelligence (AI) based

data algorithms.

– SmartDesk is focused on reinventing the workspace through developing state-of-the-art, modern, fully integrated, workplace

XR (“CXR”) – CXR is focused on realizing the potential of the metaverse.

CXR delivers Virtual Reality (VR)

and Augmented Reality (AR) solutions that provide higher productivity, progressive design and impactful experiences for consumer

products, and various commercial and industrial applications.

The Company is in the process of developing virtual reality applications

for commercialization in the metaverse over the next couple years.

CXR also invests in emerging startups focused on building best

in class solutions for the metaverse.

Driver Interactive (“VDI”) – VDI provides innovative driver training simulation solutions for effective and

engaging learning for all ages and skills.

Strong – Bravo Strong is a gaming and content studio working to building games and experiences for the metaverse.

tech (formerly Cemtrex Labs) – good tech provides mobile, web, and enterprise software application development services

for startups to large enterprises.

Services (IS)

IS segment operates through a brand, Advanced Industrial Services (“AIS”), that offers single-source expertise and services

for rigging, millwrighting, in plant maintenance, equipment erection, relocation, and disassembly to diversified customers.

high precision equipment in a wide variety of industrial markets like automotive, printing & graphics, industrial automation, packaging,

and chemicals among others.

We are a leading provider of reliability-driven maintenance and contracting solutions for the machinery,

packaging, printing, chemical, and other manufacturing markets.

The focus is on customers seeking to achieve greater asset utilization

and reliability to cut costs and increase production from existing assets, including small projects, sustaining capital, turnarounds,

maintenance, specialty welding services, and high-quality scaffolding.

the first quarter of fiscal year 2023, the Company reorganized its reporting segments to be in line with its current structure.

reports and evaluates financial information for three current segments:

the Security segment, Industrial Services segment and the Corporate

The historical segment information has been recast to conform to the current segment structure.

All intersegment transactions have been eliminated, values are presented net of eliminations.

Operating segments

The Company determines its reporting units in accordance with the

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 280, Segment Reporting.

The Company evaluates a reporting unit by first identifying its operating segments under ASC 280.

The Company operates as four operating

segments which is reported in a manner consistent with the internal reporting provided to the chief operating decision-maker.

operating decision-maker is responsible for the allocation of resources and assessing the performance of the operating segment and has

been identified as Saagar Govil, the CEO of the Company.

Security segment operates under the Vicon brand that deliver cutting-edge software and hardware technologies:

Industries, a majority owned subsidiary, provides end-to-end security solutions to meet the toughest corporate, industrial and governmental

security challenges.

Vicon’s products include browser-based video monitoring systems and analytics-based recognition systems, cameras,

servers, and access control systems for every aspect of security and surveillance in industrial and commercial facilities, federal prisons,

hospitals, universities, schools, and federal and state government offices.

Vicon provides cutting edge, mission critical security and

video surveillance solutions utilizing Artificial Intelligence (AI) based data algorithms.

Industrial Services segment operates through the brand, Advanced Industrial Services (“AIS”), that offers single-source expertise

and services for rigging, millwrighting, in plant maintenance, equipment erection, relocation, and disassembly to diversified customers.

We install high precision equipment in a wide variety of industrial markets like automotive, printing and graphics, industrial automation,

packaging, and chemicals among others.

We are a leading provider of reliability-driven maintenance and contracting solutions for the

machinery, packaging, printing, chemical, and other manufacturing markets.

The focus is on customers seeking to achieve greater asset

utilization and reliability to cut costs and increase production from existing assets, including small projects, sustaining capital,

turnarounds, maintenance, specialty welding services, and high-quality scaffolding.

following tables summarize the Company’s segment information:

SCHEDULE OF SEGMENT INFORMATION

For the years

Revenues from external customers

Advanced Technologies

Operating income/(loss)

Advanced Technologies

OF SEGMENT INFORMATION

Industrial Services

Year ended September 30, 2023

Year ended September 30, 2022

Industrial Services

Cost of revenues

Operating expenses

Sales, general, and administrative

Depreciation and amortization

Goodwill impairment

Research and development

Operating (loss)/income

$ ( 839,036 )

1 unchanged sentence

$ ( 1,511,508 )

operating loss

$ ( 10,593,305 )

$ ( 4,165,093 )

$ ( 14,129,115 )

Other income/(expense)

Advanced Technologies

other expense

Depreciation and Amortization

Advanced Technologies

depreciation and amortization

$ ( 166,369 )

$ ( 4,437,082 )

$ ( 4,489,605 )

$ ( 181,160 )

September 30,

Identifiable Assets

Advanced Technologies

Industrial Services

Discontinued operations

Company generates revenue from product sales and services from its subsidiaries located in the United States, The United Kingdom, and

1 unchanged sentence

SCHEDULE OF REVENUE FROM PRODUCT SALES AND SERVICES FROM ITS SUBSIDIARIES

the year ended

For the year ended

September 30,

United States

United Kingdom

September 30,

Long-lived Assets

United States

27 unchanged sentences

SCHEDULE OF FAIR VALUE OF ASSETS

Quoted Prices

Identical Assets

Quoted Prices in Active Markets for Identical Assets

Significant Other Observable Inputs

Significant Unobservable Inputs

Balance as of

September 30,

Investment in marketable securities

(included in short-term

Quoted Prices

Identical Assets

Investment in marketable securities (included in short-term investments)

Quoted Prices in Active Markets for Identical Assets

Significant Other Observable Inputs

Significant Unobservable Inputs

Balance as of

September 30,

Investment in marketable securities

(included in short-term

Investment in marketable securities (included in short-term investments)

5 – RESTRICTED CASH

subsidiary of the Company participates in a consortium in order to self-insure group care coverage for its employees.

administrated by Benecon Group and the Company makes monthly deposits in a trust account to cover medical claims and any

administrative costs associated with the plan.

These funds, as required by the plan are restricted in nature and amounted to $ 1,577,915

and $ 1,601,932 as

of September 30, 2022 and 2021, respectively.

Additionally, the Company had a standby letter of credit for deposit on a building lease and payable against a money market account.

The amount of the standby letter of credit was $ 517,415 as of September 30, 2021.

The plan is administrated

by Benecon Group and the Company makes monthly deposits in a trust account to cover medical claims and any administrative costs associated

with the plan.

These funds, as required by the plan are restricted in nature and amounted to $ 919,652 and $ 1,577,915 as of September

30, 2023, and 2022, respectively.

Additionally, there was $ 100,000 of restricted cash in escrow per the purchase agreement with Heisey

Mechanical, Ltd..

6 – TRADE RECEIVABLES, NET

3 unchanged sentences

September 30,

Trade receivables

Allowance for doubtful

Allowance for doubtful accounts

Accounts receivables,

receivables include amounts due for shipped products and services rendered.

for doubtful accounts includes estimated losses resulting from the inability of our customers to make required

Allowance for doubtful accounts includes estimated losses resulting from the inability of our customers to make the required payments.

7 – PREPAID AND OTHER CURRENT ASSETS

September 30, 2022, the Company had prepaid and other current assets consisting of prepayments on inventory purchases of $ 414,997 ,

costs and estimated earnings in excess of billings on uncompleted contracts of $ 781,819 ,

accrued income taxes refunds on foreign operations of $ 37,761 , and prepaid expenses and other current assets of $ 1,340,528 .

On September 30, 2021, the Company had prepaid and other current assets consisting of prepayments on inventory purchases of $ 298,707 ,

costs and estimated earnings in excess of billings on uncompleted contracts of $ 1,148,243 ,

and other current assets of $ 1,138,702 .

and other current assets consist of the following;

OF PREPAID AND OTHER CURRENT ASSETS

September 30,

Prepaid expenses

Prepaid inventory

Deferred costs

Prepaid income taxes

VAT and GST tax receivable

Prepaid expenses and other assets total

8 – INVENTORY, NET

net of reserves, consist of the following:

SCHEDULE OF INVENTORY, NET

OF INVENTORY, NET

September 30,

4 unchanged sentences

Inventory, gross

Allowance for

inventory obsolescence

( 1,088,377 )

Allowance for inventory obsolescence

( 1,088,377 )

Inventory –net

of allowance for inventory obsolescence

Inventory –net of allowance for inventory obsolescence

9 – PROPERTY AND EQUIPMENT

and equipment are summarized as follows:

SUMMARY OF PROPERTY AND EQUIPMENT

OF PROPERTY AND EQUIPMENT

September 30,

8 unchanged sentences

( 10,572,033 )

Property and equipment,

Company completed the annual impairment test of property and equipment and determined that there was no impairment as the fair value

of property and equipment substantially exceeded their carrying values at September 30, 2022.

Depreciation and amortization of

property and equipment totaled approximately $ 1,862,690

Property and equipment, net

Depreciation and amortization

of property and equipment totaled approximately $ 1,026,075

and $ 1,752,098

for fiscal years ended September 30, 2022, and 2021, respectively recorded as general and administrative expenses on the Company’s consolidated statement of operations and comprehensive

income/(loss).

for fiscal years ended September 30, 2023, and 2022, respectively recorded as general and administrative expenses on the Company’s

consolidated statement of operations and comprehensive income/(loss).

10 – GOODWILL

Changes in the carrying amount of goodwill, by segment, are as follows

SCHEDULE OF GOODWILL BY SEGMENT

Industrial Services

Balance at September 30, 2021

Impairment losses

( 3,316,000 )

Reclassified to assets held for sale

Balance at September 30, 2022

Balance at September 30, 2023

For the year ended September 30, 2023, no impairment of the Company’s

goodwill was recorded and for the year ended September 30,2022, an impairment of the Company’s goodwill of $ 3,316,000 was recorded.

11 - OTHER ASSETS

of September 30, 2022, the Company had other assets of $ 1,473,980

which was comprised of rent security deposits of $ 204,388 ,

Investment in Masterpiece VR valued at $ 1,000,000

(see below), and other assets of $ 269,592 .

As of September 30, 2021, the Company had other assets of rent security deposits of $ 84,362 ,

Investment in Masterpiece VR valued at $ 500,000

(see below), and other assets of $ 112,878 .

On November 13, 2020, Cemtrex made a $ 500,000 investment and on January 19, 2022, made an additional $ 500,000 investment via a simple

agreement for future equity (“SAFE”) in MasterpieceVR.

The SAFE provides that the Company will automatically receive

shares of the entity based on the conversion rate of future equity rounds up to a valuation cap, as defined.

MasterpieceVR is a

software company that is developing software for content creation using virtual reality.

The investment is included in other assets in

the accompanying balance sheet and the Company accounts for this investment and recorded at cost.

No impairment has been recorded

for the year ended September 30, 2022.

Company enters into operating leases for its facilities in New York, United Kingdom, and India, as well as for vehicles for use in our

Industrial Services segment.

The operating lease terms range from 2 to 7 years.

The Company excluded the renewal option on its applicable

facility leases from the calculation of its right-of-use assets and lease liabilities.

and operating lease liabilities consist of the following:

SUMMARY OF FINANCE AND OPERATING LEASE LIABILITIES

assts consists of the following;

OF OTHER ASSETS

September 30, 2023

September 30, 2022

Lease liabilities - current

Finance leases

Lease liabilities - net of current portion

Finance leases

reconciliation of undiscounted cash flows to operating lease liabilities recognized in the Consolidated Balance

Sheet at September 30, 2022, is set forth below:

SCHEDULE OF RECONCILIATION OF UNDISCOUNTED CASH FLOWS TO FINANCE AND OPERATING LEASE LIABILITIES

Rental deposits

Investment in Masterpiece VR

Other deposits

Demonstration equipment supplied to resellers

Other assets total

12 – ACCRUED EXPENSES

expenses consist of the following;

OF ACCRUED EXPENSES

September 30, 2023

September 30, 2022

Accrued expenses

Accrued payroll

Accrued warranty

Accrued expenses total total

13 – DEFERRED REVENUE

Company’s deferred revenue as of and for the years ended September 30, 2023, and 2022, are as follows;

OF DEFERRED REVENUE

For the year ended

September 30, 2023

September 30, 2022

Deferred revenue at beginning of period

Net additions:

Deferred software revenues

Recognized as revenue:

Deferred software revenues

Deferred revenue at end of period

current portion

Long-term deferred revenue at end of period

14 - CONTRACT ASSETS AND LIABILITES

contracts typically provide for a schedule of billings on percentage of completion of specific tasks inherent in the fulfillment of the

Company’s performance obligation(s).

The schedules for such billings usually do not precisely match the schedule on which costs

are incurred.

As a result, contract revenue recognized in the statements of operations can and usually does differ from amounts that

can be billed to the customer at any point during the contract.

Amounts by which cumulative contract revenue recognized on a contract

as of a given date exceeds cumulative billings and unbilled receivables to the customer under the contract are reflected as a current

asset in the balance sheets under the caption “Contract assets.” Amounts by which cumulative billings to the customer under

a contract as of a given date exceed cumulative contract revenue recognized are reflected as a current liability in the balance sheets

under the caption “Contract liabilities.” Conditional retainage represents the portion of the contract price withheld until

the work is substantially complete for assurance of the Company’s obligations to complete the job.

following is a summary of the Company’s uncompleted contracts:

OF CONTRACT ASSETS AND LIABILITIES

For the year ended

September 30, 2023

September 30, 2022

Costs incurred on uncompleted contracts

Estimated gross profit

Applicable billings to date

( 14,850,020 )

( 2,591,627 )

September 30, 2023

September 30, 2022

September 30, 2021

Included in the accompanying balance sheet under the following captions

Contract assets

Contract liabilites

Company is party to contracts where we lease property from others under contracts classified as operating leases.

The Company primarily

leases office and operating facilities, vehicles, and office equipment.

The weighted average remaining term of our operating leases was

approximately 3 years at September 30, 2023, and 3 years at September 30, 2022.

Lease liabilities were $ 2,348,689 with $ 741,487 classified

as short-term at September 30, 2023, and $ 2,576,963 with $ 754,495 , classified as short-term at September 30, 2022.

The weighted average

discount rate used to measure lease liabilities was approximately 5.66 % at September 30, 2023, and 2022.

The Company used the rate implicit

in the lease, where known, or its incremental borrowing rate as the rate used to discount the future lease payments.

Company also made the accounting policy decision not to recognize lease assets and liabilities for leases with a term of 12 months or

Company’s corporate segment leases approximately 100

square feet of office space in Brooklyn, NY on a month-to-month lease at a rent of $ 600

per month with $ 4,200 of expense for the year ended September 30, 2023 and approximately 911

square feet of office space in Clovis, CA on a month-to-month lease at a monthly rent of $ 4,930

with $ 5,550 of expense for the year ended September 30, 2023.

The expense is under the caption “General and administrative” on the Company’s Consolidated Statement

of Operations.

reconciliation of undiscounted cash flows to operating lease liabilities recognized in the Consolidated Balance Sheet at September 30,

2023, is set forth below:

OF RECONCILIATION OF UNDISCOUNTED CASH FLOWS TO OPERATING LEASE LIABILITIES

Years ending September 30,

Operating Leases

2028 & Thereafter

Undiscounted lease payments

representing interest

lease payments

disclosures of lease data are set forth below:

SCHEDULE OF LEASE COSTS

For the years ended

Finance lease costs:

of finance lease assets

on lease liabilities

Amount representing interest

Discounted lease payments

costs for the years ended September 30, 2023, and 2022 are set forth below:

OF LEASE COSTS

For the year ended

September 30,

Operating lease costs

lease expense

Other information:

Cash paid for amounts included

in the measurement of lease liabilities:

Operating leases

Weighted-average remaining lease term - finance

leases (months)

Weighted-average remaining lease term - operating

leases (months)

Weighted-average discount rate - finance leases

Weighted-average discount rate - operating

Company used the rate implicit in the lease, where known, or its incremental borrowing rate as the rate used to discount the future lease

Total lease cost

16 – LINES OF CREDIT AND LONG-TERM LIABILITIES

Company currently has a line of credit with Fulton Bank for $ 3,500,000 .

The line carried interest of LIBOR plus 2.00 % per annum ( 2.075 %

as of September 30, 2021).

On June 10, 2022, the Company and Fulton Bank agreed to an amendment of the line of credit to carry interest

at the Secured Overnight Financing Rate (“SOFR”) plus 2.37 % per annum ( 5.35 % as of September 30, 2022).

At September 30,

2022 and September 30, 2021, there was no outstanding balance on this line of credit.

The terms of this line of credit are subject to

the bank’s review annually on February 1.

payable to bank

December 15, 2015, the Company acquired a loan from Fulton Bank in the amount of $ 5,250,000

in order to fund the purchase of Advanced Industrial Services, Inc.

of the proceeds went to the direct purchase of AIS.

This loan carried interest of LIBOR plus 2.25 %

per annum ( 2.325 %

as of September 30, 2021).

On June 10, 2022, The Company and Fulton Bank agreed to an amendment of the loan to carry interest at

SOFR plus 2.37 %

per annum ( 5.35 %

as of September 30, 2022).

This loan is payable on December 15, 2022.

This loan carries loan covenants which the Company was in

compliance with as of September 30, 2022.

The outstanding balance on this loan was $ 247,284

and $ 1,218,680 ,

on September 30, 2022, and September 30, 2021, respectively.

This loan is secured by certain assets of the Company.

May 1, 2018, the Company acquired a loan from Fulton Bank in the amount of $ 400,000 in order to fund new equipment for Advanced Industrial

Services, Inc.

This loan carried interest of LIBOR plus 2.00 % per annum ( 2.075 % as of September 30, 2021).

On June 10, 2022, The Company

and Fulton Bank agreed to an amendment of the loan to carry interest at SOFR plus 2.37 % per annum ( 5.35 % as of September 30, 2022).

loan is payable on May 1, 2023.

This loan carries loan covenants which the Company was in compliance with as of September 30, 2022.

outstanding balance on this loan was $ 63,281 and $ 149,914 , on September 30, 2022, and September 30, 2021, respectively.

secured by certain assets of the Company

January 28, 2020, the Company acquired a loan from Fulton Bank in the amount of $ 360,000 in order to fund new equipment for Advanced

Industrial Services, Inc.

This loan carried interest of LIBOR plus 2.25 % per annum ( 2.325 % as of September 30, 2021).

On June 10, 2022,

The Company and Fulton Bank agreed to an amendment of the loan to carry interest at SOFR plus 2.37 % per annum ( 5.35 % as of September

This loan is payable on May 1, 2023.

This loan carries loan covenants which the Company was in compliance with as of September

The outstanding balance on this loan was $ 183,839 and $ 258,060 , on September 30, 2022, and September 30, 2021, respectively.

January 12, 2023, the Company entered into a standstill agreement with Streeterville Capital, LLC.

The lender has agreed to refrain and

forbear temporarily from making redemptions under the notes for a period ending on April 12, 2023.

In addition, the company has agreed

to an increase of the outstanding balance of the note issued on September 30, 2021, for the original amount of $ 5,755,000 by $ 148,000 ,

and the outstanding balance of the note issued on February 22, 2022, for the original amount of $ 9,205,000 by $ 303,422 .

The aggregate

amount of $ 451,422 has been recorded as interest expense on the Company’s Consolidated Statement of Operations and Consolidated

Statements of Cash Flow.

February 15, 2023, the Company and Fulton Bank agreed to an amendment to the Master Agreement Regarding Financial Covenants and Financial

Deliverables dated September 22, 2020.

March 3, 2023, the Company and NIL Funding agreed at an amendment to the term loan agreement dated September 18, 2018.

This agreement

amends the maturity date to December 31, 2024 , and amends the interest rate to 11.5 %.

Additionally, the Company paid $ 10,000 in fees

and made an additional principal payment of $ 100,000 on March 29, 2023, and is required to make another additional principal payment

of $ 100,000 on or before March 29, 2024.

The Company has accounted for this amendment as a debt modification.

May 3, 2023, the Company and Streeterville Capital, LLC.

agreed to an amendment to the note issued on September 30, 2021, for the original

amount of $ 5,755,000 .

The agreement extends the maturity date to June 30, 2024 , in exchange for a fee of 5 % of the outstanding balance

or approximately $ 252,912 added to the outstanding balance of the note.

The Company has accounted for this amendment as a debt modification.

April 3, 2023, the Company and SeKureID Solutions Corp., entered into a software license agreement, where the company obtained the right

to use source code for its security products in exchange for $ 1,125,000 payable in (15) fifteen equal monthly installments of $ 75,000 .

The current balance of $ 675,000 is presented on the Consolidated Balance Sheets as of September 30, 2023, under Short-term liabilities,

net of unamortized original issue discounts.

July 1, 2023, as part of the Heisey acquisition, the Company issued a note payable to Heisey Mechanical, Ltd.

In the amount of $ 240,000 .

This note carries interest of 6 % and is payable one year from the date of the note.

The current balance of $ 240,000 is presented on the

Consolidated Balance Sheets as of September 30, 2023, under the caption Short-term liabilities, net of unamortized original issue discounts.

July 1, 2023, as part of the Heisey acquisition, the Company acquired a loan from Fulton Bank in the amount of $ 2,160,000 .

The loan carries

interest at the Secured Overnight Financing Rate (SOFR) plus 2.8 % and matures on July 1, 2030 .

August 30, 2023, the Company acquired a mortgage in the amount of $ 1,200,000 from Fulton Bank to finance the purchase of the properties

formerly owned by Heisey Mechanical Ltd.

The mortgage carries interest at the Secured Overnight Financing Rate (SOFR) plus 2.8 % and matures

on September 30, 2043 .

OF LINES OF CREDIT AND LIABILITIES

Interest Rate

September 30, 2023

September 30, 2022

Fulton Bank loan $ 5,250,000 for the purchase of AIS $ 5,000,000 of the proceeds went to the direct purchase of AIS.

SOFR plus 2.37 %( 5.35 % as of September 30, 2022)

Fulton Bank loan $ 400,000 fund equipment for AIS.

SOFR plus 2.37 % ( 5.35 % as of September 30, 2022)

Fulton Bank - $ 360,000 fund equipment for AIS.

The Company was in compliance with loan covenants as of June 30, 2023.

This loan is secured by certain assets of the Company.

September 30, 2020, the Company issued a note payable to an independent private lender in the amount of $ 4,605,000 .

This note carried

interest of 8 % and matured on March 30, 2022 .

After deduction of an original issue discount of $ 600,000 and legal fees of $ 5,000 , the

Company received $ 4,000,000 in cash.

As of September 30, 2022, and September 30, 2021, this note had a balance of $ 0 and $ 2,256,448 ,

respectively.

As of September 30, 2022, and September 31, 2021, this note had unamortized original issue discount balance of $ 0 and $ 200,000 ,

October 26, 2020, the Company issued a Note payable in the amount of $ 439,774 for the purchase of VDI.

This note carried interest of

5 % and was payable in two installments on October 26, 2021, and October 26, 2022.

As of September 30, 2022, and September 30, 2021, this

note had a balance of $ 219,370 and $ 460,377 , respectively.

As of the date of this report, all principal and accrued interest on this note

have been paid.

September 30, 2021, the Company issued a note payable to an independent private lender in the amount of $ 5,755,000 .

This note carries

interest of 8 % and matures on March 30, 2023 .

After deduction of an original issue discount of $ 750,000 and legal fees of $ 5,000 , the

Company received $ 5,000,000 in cash.

As of September 30, 2022, and September 30, 2021, this note had a balance of $ 4,943,929 and $ 5,005,000 ,

respectively.

As of September 30, 2022, and September 31, 2021, this note had unamortized original issue discount balance of $ 250,000

and $ 750,000 , respectively.

February 22, 2022, the Company issued a note payable to an independent private lender in the amount of $ 9,205,000 .

This note carries interest of 8 %

and matures on August

After deduction of an original issue

discount of $ 1,200,000

and legal fees of $ 5,000 ,

the Company received $ 8,000,000

Additionally, the Company issued 1,000,000

shares of its common stock to the lender.

fair market value of the stock of $ 700,400

was recognized as an additional original issue

discount and will be amortized over the life of the loan.

As of September 30, 2022, this note had a balance of $ 9,738,632 .

As of September 30, 2022, this note had unamortized original issue discount balance of $ 1,064,778 .

March 30, 2022, Vicon, a subsidiary of the Company, amended the $ 5,600,000 Term Loan Agreement with NIL Funding Corporation (“NIL”).

Upon closing, $ 500,000 of outstanding borrowings were repaid to NIL.

The Agreement requires monthly payments of accrued interest that

began on October 1, 2018.

This note carries interest of 8.85 % and matures on March 30, 2023 .

This note carries loan covenants which the

Company is in compliance with as of September 30, 2022.

As of September 30, 2022, and September 30, 2021, this note had a balance of

$ 2,804,743 and $ 3,604,743 , respectively.

January 28, 2020, the Company’s subsidiary, Advanced Industrial Services, Inc., completed the purchase of two buildings for a total

purchase price of $ 3,381,433 .

The Company paid $ 905,433 in cash and acquired a mortgage from Fulton Bank in the amount of $ 2,476,000 .

This mortgage carried interest of LIBOR plus 2.50 % per annum ( 2.575 % as of September 30, 2021).

On June 10, 2022, The Company and Fulton

Bank agreed to an amendment of the mortgage to carry interest at SOFR plus 2.62 % per annum ( 5.6 % as of September 30, 2022).

This mortgage

is payable on January 28, 2040 .

This loan carries loan covenants similar to covenants on the Company’s other loans from Fulton

As of September 30, 2022, the Company was in compliance with these covenants.

As of September 30, 2022, and September 30, 2021,

this mortgage had a balance of $ 2,245,664 and $ 2,339,114 , respectively.

Protection Program Loans

April and May of 2020, and January and April of 2021, the Company and its subsidiaries applied for and were granted $ 6,413,385 in Paycheck

Protection Program loans under the CARES Act.

These loans bear interest of 2 % and mature in two years.

The Company has applied for and

received loan forgiveness under the provisions of the CARES Act for $ 6,291,985 , recorded as other income on the Company’s consolidated statement

of operations and comprehensive income/(loss).

The remaining loan of $ 121,400 has been modified with

a maturity date of May 5, 2025 and payments starting in June of 2022 and is recorded under Paycheck Protection Program Loans on our Consolidated Balance Sheet as of September 30, 2022, net of the short-term portion of $ 24,280 .

The issuing bank determined that this

loan qualifies for loan forgiveness;

SOFR plus 2.37 % ( 7.68 % as of September 30, 2023 and 5.35 % as of September 30, 2022).

Fulton Bank mortgage $ 2,476,000 .

The Company was in compliance with loan covenants as of September 30, 2023.

This loan is secured by the underlying asset.

SOFR plus 2.62 % ( 7.93 % on September 30, 2023 and 5.6 % as of September 30, 2022).

Fulton Bank (HEISEY) - mortgage loan;

requires monthly principal and interest payments through August 1, 2043 with a final payment of remaining principal on September 1, 2043;

The loan is collateralized by 615 Florence Street and 740 Barber Street.

SOFR plus 2.80 % per annum ( 8.11 % as of September 30, 2023).

Fulton Bank (HEISEY) - promissory note related to purchase of Heisey;

requires 84 monthly principal and interest payments;

The note is collateralized by all assets and guaranteed by the Parent;

matures in 2030.

SOFR plus 2.8 % per annum ( 8.11 % as of September 30, 2023)

Note payable - $ 439,774 .

For the purchase of VDI.

Payable in two installments on October 26, 2021, and October 26, 2022.

Note payable - $ 5,755,000 - Less original issue discount $ 750,000 and legal fees $ 5,000 , net cash received $ 5,000,000 Unamortized original issue discount balance of $ 0 and $ 250,000 , as of September 30, 2023 and September 30, 2022 respectively.

Note payable - $ 9,205,000 .

Less original issue discount $ 1,200,000 and legal fees $ 5,000 ,net cash received $ 8,000,000 .

28,572 shares of common stock valued at $ 700,400 recognized as additional original issue discount.

Unamortized original issue discount balance of $ 0 and $ 1,064,778 as of September 30, 2023 and September 30, 2022 respectivly.

Note Payable - $ 240,000 For the purchase of Heisey Mechanical, Ltd.

Term Loan Agreement with NIL Funding Corporation (“NIL”) - $ 5,600,000 The Company was in compliance with loan covenants as of September 30, 2023.

Paycheck Protection Program loan - $ 121,400 - The issuing bank determined that this loan qualifies for loan forgiveness;

however the Company is awaiting final approval from the Small Business Administration.

maturities of our long-term debt over the next 5 years are as follows:

Software License Agreement - $ 1,125,000 , for the purchase of software source code for use in our Security segment products

Total lines of credit and secured liabilities

Current maturities

( 14,507,711 )

( 16,894,743 )

Unamortized original issue discount

( 1,305,778 )

Lines of credit and secured liabilities, Long Term

maturities of the Company’s long-term debt over the next 5 years are as follows:

OF ESTIMATED MATURITIES OF LONG TERM DEBT

Bank - $ 5,250,000

Bank - $ 400,000

Bank - $ 360,000

Bank - Mortgage payable

Fulton Bank - $ 360,000

Fulton Bank - $ 2.16 Mil

Fulton Bank - Mortgage #1

Fulton Bank - Mortgage #2

Notes Payable

Software License Agreement

17 – RELATED PARTY TRANSACTIONS

July 31, 2022 the Company negotiated a payment agreement surrounding the sale of Griffin Filters, LLC and other liabilities due to Cemtrex,

from Aron Govil, the Company’s Founder and former Director totaling $761,585 .

of September 30, 2023, and September 30, 2022, there was $ 3,806 payable due to Ducon Technologies, Inc.

and $ 19,133 , respectively, payable

due to Ducon Technologies, Inc., which is controlled by Aron Govil, the Company’s Founder and Former Director and CFO.

As of September

30, 2023, there were $ 637,208 of receivables due from Ducon Technologies, Inc.

The Company has negotiated a payment agreement regarding

past receivables and other liabilities due to Cemtrex, Inc.

totaling $ 761,585 .

This agreement is in the form of a secured promissory

note earning interest at a rate of 5 % per annum and matures on July 31, 2024 .

See Item 13 of Part III of this report for more information regarding transactions related to Aron Govil.

14 – SHAREHOLDERS’ EQUITY

July 27, 2020, the Company amended the Company’s Certificate of Incorporation (the “Amended Certificate of Incorporation”)

which was duly approved by the Company’s Board of Directors and duly adopted by the Company’s shareholders increasing the

number of authorized shares of all classes of stock from 30,000,000 shares to 60,000,000 shares with 50,000,000 designated as Common

Stock and 10,000,000 designated as Preferred Stock.

Receivables of $ 708,512 representing the amount due from

Ducon to Cemtrex Technologies Pvt.

the Company’s subsidiary based in India has been written off in fiscal 2022 to bad debt

and appears on the Company’s consolidated statements of operations under general and administrative expenses.

February 26, 2021, the Company entered into a Settlement Agreement and Release with Aron Govil regarding a dispute over an alleged misappropriation

part of the Settlement Agreement, Mr.

Govil was required to pay the Company consideration with a total value of $ 7,100,000 (the “Settlement

Amount”) by entering into the Agreement.

The Settlement Amount was satisfied in a combination of Mr.

Govil forfeiting certain Preferred

Stock and outstanding options and executing a secured note in the amount of $ 1,533,280 .

The Independent Board of Directors in coordination

with Management concluded the settlement represented fair value.

discussed above, Mr.

Govil also executed a secured promissory note (the “Note”) in the amount of $ 1,533,280 .

The Note matures

and is due in full in two years and bears interest at 9 % per annum and is secured by all of Mr.

Govil’s assets.

agreed to sign an affidavit confessing judgment in the event of a default on the Note.

While the Company believes the note is fully collectible,

in accordance with ASC 450-30, Gain Contingencies, the Company determined the gain will not be recognized until the note is paid.

the note and associated gain is not presented on the Company’s Consolidated Balance Sheets and Consolidated Statements of Operations

and Comprehensive Income/(Loss).

November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”)

with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, and Cemtrex XR,

Inc., which include the brands SmartDesk, Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs),

Govil (see NOTE 1).

of September 30, 2023, there was $ 476,134 in trade receivables due from these companies and $ 64,703 in accounts payables.

Of these receivables

$ 132,102 are related to costs paid by Cemtrex related to payroll during the transition of employees to the new company and some subscription

services that are set up on auto pay with a credit card.

The remaining $ 344,032 is related to services provided by Cemtrex Technologies

in the normal course of business.

During Fiscal year 2023, the Company recognized $ 1,522,102 of revenue from these companies.

During fiscal year 2023, $ 38,027 of trade receivables were reserved for by the Company’s subsidiary Cemtrex Technologies Pvt.

Due to regulations by the Indian tax authority.

The Company will keep this allowance in place but considers the debt to be collectable.

These balances are presented on the Consolidated Balance Sheets under the captions “Trade receivables - related party” and

“Accounts payable - related party”.

of September 30, 2023, there were royalties receivable from the sale of Cemtrex, XR, Inc.

of $ 704,893 , $ 30,000 is considered short-term and reported under the caption

“Trade receivables - related party”.

18 – STOCKHOLDERS’ EQUITY

Company is authorized to issue 10,000,000 shares of Preferred Stock, $ 0.001 par value.

12 unchanged sentences

Series A Preferred Stock has no redemption rights.

the twelve-month period ended September 30, 2021, the Company retired 1,000,000 shares of Series A Preferred Stock surrendered by Aron

Govil as part of the settlement agreement.

See Item 13 of Part III of this report for more details.

of September 30, 2023, and September 30, 2022, there were no shares of Series A Preferred Stock issued and outstanding.

7 unchanged sentences

presented to our shareholders for their action or consideration, including the election of directors.

The Series C Preferred Stock has

no liquidation value or preference.

The Series C Preferred Stock has

no redemption rights.

the year ended September 30, 2020, 100,000

shares of Series C Preferred Stock were issued to Aron Govil, Executive former Director and CFO of the Company as part of his

employment agreement.

In order to determine the fair market value of these shares (estimated to be $ 0.95 per share), the Company

used the closing price of its Series 1 preferred stock of $ 0.95

on October 3, 2019.

On July 10, 2020, Aron Govil transferred 50,000

shares of the Series C Preferred Stock to Saagar Govil.

the year ended September 30, 2021, the Company retired 50,000 shares of Series C Preferred Stock surrendered by Aron Govil as part of

the settlement agreement.

See Item 13 of Part III of this report for more details.

Series C Preferred Stock has no liquidation value or preference.

Series C Preferred Stock has no redemption rights.

of September 30, 2023, and September 30, 2022, there were 50,000 shares of Series C Preferred Stock issued and outstanding.

4 unchanged sentences

Series 1 Preferred, valued at their liquidation preference.

The Series 1 Preferred rank senior to the common stock with respect

to dividends.

The Series 1 Preferred rank senior to the common stock with respect to dividends.

Dividends will be entitled to be paid prior to any dividend to the holders of our common stock.

Series 1 Preferred has a liquidation preference of $ 10 per share, equal to its purchase price.

In the event of any liquidation,

dissolution or winding up of our company, any amounts remaining available for distribution to stockholders after payment of all liabilities

of our company will be distributed first to the holders of Series 1 Preferred, and then pari passu to the holders of the Series

A preferred stock and our common stock.

The holders of Series 1 Preferred have preference over the holders of our common stock on

any liquidation, dissolution or winding up of our company.

The holders of Series 1 Preferred also have preference over the holders

of our Series A preferred stock.

In the event of any liquidation, dissolution

or winding up of our company, any amounts remaining available for distribution to stockholders after payment of all liabilities of our

company will be distributed first to the holders of Series 1 Preferred, and then pari passu to the holders of the Series A preferred

stock and our common stock.

The holders of Series 1 Preferred have preference over the holders of our common stock on any liquidation,

dissolution or winding up of our company.

The holders of Series 1 Preferred also have preference over the holders of our Series A preferred

as otherwise provided in the certificate of designation, preferences and rights or as required by law, the Series 1 Preferred will vote

15 unchanged sentences

to all of our existing and future indebtedness.

Shares of Series 1 Preferred may

be redeemed, in whole or in part, at the option of the Corporation, by the Corporation by giving notice of such redemption at any time.

Notice of redemption may be given either by mailing notice to the holders of record or by public announcement, by press release or otherwise.

If notice is given by public announcement, by press release or otherwise, such notice shall be effective as of the date of such announcement,

regardless of whether notice is also mailed or otherwise given to holders of record.

The redemption price for any shares of Series 1 Preferred

to be redeemed (the “Redemption Price”) shall be payable in cash, out of funds legally available therefor, and shall be equal

to the Preference Amount, plus any accrued but unpaid dividends.

If fewer than all of the outstanding shares of Series 1 Preferred are

to be redeemed at any time, the Corporation may choose to redeem shares proportionally from all holders, or may choose the shares to be

redeemed by lot or by any other equitable method.

of Series 1 Preferred may be redeemed, in whole or in part, at the option of the Corporation, by the Corporation by giving notice of

such redemption at any time.

Notice of redemption may be given either by mailing notice to the holders of record or by public announcement,

by press release or otherwise.

If notice is given by public announcement, by press release or otherwise, such notice shall be effective

as of the date of such announcement, regardless of whether notice is also mailed or otherwise given to holders of record.

The redemption

price for any shares of Series 1 Preferred to be redeemed (the “Redemption Price”) shall be payable in cash, out of funds

legally available therefor, and shall be equal to the Preference Amount, plus any accrued but unpaid dividends.

If fewer than all of

the outstanding shares of Series 1 Preferred are to be redeemed at any time, the Corporation may choose to redeem shares proportionally

from all holders or may choose the shares to be redeemed by lot or by any other equitable method.

March 30, 2020, the Company amended the Certificate of Designation (the “Amended Certificate of Designation”) for our Series

5 unchanged sentences

respectively.

the year ended September 30, 2021, the Company retired 469,949 shares of Series 1 Preferred Stock surrendered by Aron Govil as part of

the settlement agreement.

See Item 13 of Part III of this report for more details.

of September 30, 2023, and September 30, 2022, there were 2,293,016 and 2,079,122 shares of Series 1 Preferred Stock issued and 2,228,916

1 unchanged sentence

The Company currently holds 64,100 shares of Series 1 Stock in Treasury stock.

July 29, 2022, the Company received a notification letter from the Listing Qualifications Department of The Nasdaq Stock Market LLC (“Nasdaq”)

notifying the Company that, because the closing bid price for the Company’s Series 1 preferred stock listed on Nasdaq was below

$1.00 for 30 consecutive trading days, the Company no longer met the minimum bid price requirement for continued listing on The Nasdaq

Capital Market under Nasdaq Marketplace Rule 5550(a)(2), requiring a minimum bid price of $1.00 per share (the “Minimum Bid Price

Requirement”) .

On January 26, 2023, the Company received a notification letter from the Listing Qualifications Department of Nasdaq

notifying the Company that, it had been granted an additional 180 days or until July 24, 2023, to regain compliance with the Minimum

Bid Price Requirement based on the Company meeting the continued listing requirement for market value of publicly held shares and all

other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s

written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.

On September 8, 2023, the Company received a letter from the Nasdaq Hearings Panel (“Panel”) informing the Company that the

Panel has granted the Company a temporary exception to regain compliance with The Nasdaq Stock Market LLC’s (“Nasdaq”

or the “Exchange”) Listing Rule 5555(a)(1) (the “Bid Price Rule”) by no later than January 19, 2024.

has announced a special meeting of Series 1 Preferred stock shareholders scheduled for December 26, 2023, to approve the reverse stock

August 22, 2023, the Board of Directors (the “Board”) of Cemtrex, Inc.

authorized and approved a share repurchase program

for up to 2,200,000 shares of the currently outstanding shares of the Company’s Series 1 Preferred Stock over a period of 3 years,

starting on September 1, 2023, and ending on August 31, 2026.

Under the stock repurchase program, the Company intends to repurchase shares

through open market purchases, privately negotiated transactions, block purchases or otherwise in accordance with applicable federal

securities laws, including Rule 10b-18 of the Exchange Act.

Board also authorized the Company to enter into written trading plans under Rule 10b5-1 of the Exchange Act.

Adopting a trading plan

that satisfies the conditions of Rule 10b5-1 allows a company to repurchase its shares at times when it might otherwise be prevented

from doing so due to self-imposed trading blackout periods or pursuant to insider trading laws.

Under any Rule 10b5-1 trading plan, the

Company’s third-party broker, subject to Securities and Exchange Commission regulations regarding certain price, market, volume

and timing constraints, would have authority to purchase the Company’s Series 1 Preferred Stock in accordance with the terms of

The Company may from time to time enter into Rule 10b5-1 trading plans to facilitate the repurchase of its Series 1 Preferred

Stock pursuant to its share repurchase program.

Company cannot predict when or if it will repurchase any shares of Series 1 Preferred Stock as such stock repurchase program will depend

on a number of factors, including constraints specified in any Rule 10b5-1 trading plans, price, general business and market conditions,

and alternative investment opportunities.

Company is authorized to issue 50,000,000 shares of common stock, $ 0.001 par value.

1 unchanged sentence

issued and outstanding and at September 30, 2022, there were 754,711 shares issued and outstanding.

the fiscal year ended September 30, 2022, we issued 5,481,102 shares of common stock to satisfy $ 4,688,524 of notes payable and accumulated

the fiscal year ended September 30, 2021, we issued 3,159,655 shares of common stock to satisfy $ 5,025,651 of notes payable and accumulated

fiscal year 2022, the Company issued 150,000 shares in exchange for $ 50,000 worth of services.

January 31, 2022, warrants to purchase 433,965 shares of our common stock (issuable upon the exercise of our publicly traded Series 1 warrants), at

an exercise price of $ 50.48 per share expired.

the years ended September 30, 2022, and 2021, no outstanding Series 1 Warrants were exercised.

January 25, 2023, the Company completed a 35:1 reverse stock split on its common stock.

All share and per share data have been retroactively

adjusted for this reverse split.

On February 2, 2023, 19,314 shares were issued for rounding shares of the reverse stock split.

the year ended September 30, 2023, 241,655 shares of the Company’s common stock have been issued to satisfy $ 780,140 of notes payable,

$ 769,860 in accrued interest, and $ 367873 of excess value of shares issued recorded as interest expense.

the year ended September 30, 2023, 30,103 shares of the Company’s common stock have been issued in exchange for services valued

at $ 215,800 .

19 – SHARE-BASED COMPENSATION

4 unchanged sentences

Govil was granted additional future options;

100,000 shares of the Corporation’s common stock, CETX at an exercise price of $ 1.92 per share on September 25, 2021 ;

100,000 shares of the Corporation’s common stock, CETX at an exercise price of $ 2.30 per share on September 25, 2023 ;

100,000 shares of the Corporation’s common stock, CETX at an exercise price of $ 2.76 per share on September 25, 2025 .

September 25, 2019, the Company granted to Aron Govil, the Company’s former Executive Director and CFO, a stock option for 200,000

These options have an exercise price of $ 1.90 per share, which vested upon grant and they expire after seven years .

25,000 shares of the Corporation’s common stock, CETX at an exercise price of $ 1.92 per share on September 25, 2021 ;

12,500 shares of the Corporation’s common stock, CETX at an exercise price of $ 2.30 per share on September 25, 2023 ;

8,333 shares of the Corporation’s common stock, CETX at an exercise price of $ 2.76 per share on September 25, 2025 .

part of the settlement agreement with Mr.

Govil, all his options were cancelled.

January 6, 2021, the Company granted Christopher C.

Moore, the Company’s CFO, a stock option for 150,000 shares.

These options

have an exercise price of $ 1.58 per share, which vest over five years , and they expire after five years.

These options were cancelled

Moore’s departure from the Company.

2,868 shares of the Corporation’s common stock, CETX at an exercise price of $ 67.20 per share vesting on September 25,

2,858 shares of the Corporation’s common stock, CETX at an exercise price of $ 80.64 per share vesting on September 25, 2023 ;

2,858 shares of the Corporation’s common stock, CETX at an exercise price of $ 96.77 per share vesting on September 25,

April 28, 2022, the Company granted Brian Kwon, Manpreet Singh, Chris Wagner, and Metodi Filipov, all Directors of the Company, stock

2 unchanged sentences

year , and expire after five years .

The options granted to Mr.

Wagner were cancelled upon his resignation from the Board on November 8,

following weighted-average assumptions were used to estimate the fair value of the common stock option liability for the options granted

1 unchanged sentence

OF FAIR VALUE STOCK OPTION WEIGHTED AVERAGE ASSUMPTIONS

interest rate

dividend yield

April 28, 2022

Expected term

Risk-free interest rate

Expected volatility

Expected dividend yield

the years ended September 30, 2023, and 2022 the Company recognized $ 106,839 and $ 155,507 of share-based compensation expense on its

outstanding options, respectively.

The share-based compensation is listed under the caption “General and administrative”

expenses on the Company’s consolidated statement of operations.

of September 30, 2023, there was $ 63,306 of total unrecognized compensation cost related to non-vested stock options, which is expected

1 unchanged sentence

OF STOCK OPTIONS ACTIVITY

Average Exercise Price

Average Remaining Contractual Term (in years)

Intrinsic Value

at September 30, 2021

at September 30, 2022

Vested and exercisable

at September 30, 2022

Number of Options

Weighted Average Exercise Price

Weighted Average Remaining Contractual Term (in years)

Aggregate Intrinsic Value

Outstanding at September 30, 2022

Options granted

Options exercised

Options forfeited

Options cancelled

Outstanding at September 30, 2023

Vested and exercisable at September 30, 2022

20 – COMMITMENTS AND CONTINGENCIES

Company has its corporate headquarters in New York City with a 12-month lease of 2,500 square feet of office space at a rate of $ 10,000

per month expiring on February 28, 2023.

Company’s IS segment owns approximately 25,000 square feet of warehouse space in Manchester, PA and approximately 43,000 square

feet of office and warehouse space in York, PA.

The IS segment also leases approximately 15,500 square feet of warehouse space in Emigsville,

PA from a third party in a three-year lease at a monthly rent of $ 5,099 expiring on August 31, 2025 .

Company’s AT segment leases (i) approximately 6,700 square feet of office and warehouse space in Pune, India from a third party

in an five year lease at a monthly rent of $ 5,810 (INR 456,972 ) expiring on February 28, 2024 , (ii) approximately 30,000 square feet of

office and warehouse space in Hauppauge, New York from a third party in a seven-year lease at a monthly rent of $ 28,719 expiring on March

31, 2027 , (iii) approximately 4,570 square feet of office space in El Dorado Hills, California in a 63 month lease assumed by the company

upon the acquisition of VDI at a monthly rent of $ 7,077 expiring on November 30, 2022 , and (iv) approximately 9,400 square feet of office

and warehouse space in Hampshire, England in a fifteen-year lease with at a monthly rent of $ 9,821 (£ 7,669 ) which expires on March

24, 2031 and contains provisions to terminate in 2026 .

Company’s Industrial Services segment owns approximately (i) 25,000 square feet of warehouse space in Manchester, PA (ii) approximately

43,000 square feet of office and warehouse space in York, PA (iii) approximately 33,500 square feet of office and warehouse space and

0.71 acres of land in a non-contiguous lot utilized for outdoor storage space in Columbia, PA.

The IS segment also leases approximately

15,500 square feet of warehouse space in Emigsville, PA from a third party in a three-year lease at a monthly rent of $ 5,099 expiring

on August 31, 2025 .

Company’s Security segment leases (i) approximately 6,700 square feet of office and warehouse space in Pune, India from a third

party in an five year lease at a monthly rent of $ 6,453 (INR 456,972 ) expiring on February 28, 2024 , (ii) approximately 30,000 square

feet of office and warehouse space in Hauppauge, NY from a third party in a seven-year lease at a monthly rent of $ 28,719 expiring on

March 31, 2027 , (iii) approximately 9,400 square feet of office and warehouse space in Hampshire, England in a fifteen-year lease with

at a monthly rent of $ 7,329 (£ 5,771 ) which expires on March 24, 2031 and contains provisions to terminate in 2026 , and (iv) approximately

911 square feet of office space in Clovis, CA on a month-to-month lease at a monthly rent of $ 4,930 .

21 – INCOME TAXES

5 unchanged sentences

sourced earnings.

September 30, 2022, the Company had approximately $ 70,061,515 of federal and $ 34,312,917 of state net operating losses.

The net operating

loss carryforwards, if not utilized, will begin to expire in 2036 for federal purposes and in 2036 for state purposes .

The company is

currently reviewing net operating losses for Section 382 limitation purposes and will make any required adjustments to the net operating

losses at the completion of the study.

September 30, 2023, the Company had approximately $ 74,648,921 of

federal and $ 51,175,344 of

state net operating losses.

net operating loss carryforwards, if not utilized, will begin to expire in 2037 for federal purposes and in 2037 for state purposes.

company is currently reviewing net operating losses for Section 382 limitation purposes and will make any required adjustments to

the net operating losses at the completion of the study.

following is a geographical breakdown of loss before the provision for income taxes:

OF (LOSS) INCOME BEFORE PROVISION FOR TAX

ended September 30,

Year ended September 30,

$ ( 6,279,077 )

$ ( 9,429,686 )

before provision for income taxes

( 1,397,394 )

Loss before provision for income taxes

$ ( 6,001,113 )

$ ( 10,827,080 )

provision for income taxes consisted of the following:

OF PROVISION FOR INCOME TAXES

(benefit)/provision

September 30, 2023

September 30, 2022

Current (benefit)/provision

Total current (benefit)/provision

Deferred provision

(benefit)/provision for income taxes

Total deferred provision

Total (benefit)/provision for income taxes

$ ( 209,345 )

Income tax rate

Effective Income tax rate

following is a reconciliation of the effective income tax rate to the federal and state statutory rates:

OF EFFECTIVE INCOME TAX RATE RECONCILIATION

the Fiscal Year

For the Fiscal Year

September 30, 2023

September 30, 2022

statutory rate

taxes, net of federal

tax rate differential

in valuation allowance

settlement payment

loan forgiveness

State taxes, net of federal

Foreign tax rate differential

Change in valuation allowance

Return to provision

Goodwill impairment

SEC settlement payment

PPP loan forgiveness

Global intangible income

Permanent differences

Effective rate

components of our deferred tax assets and liabilities are summarized as follows:

OF DEFERRED TAX ASSETS AND LIABILITIES

operating loss carryforwards

(interest expense)

gross deferred taxes

( 20,895,094 )

( 9,491,650 )

September 30, 2023

September 30, 2022

Deferred Tax Assets:

Tax Liabilities:

and other Reserves

Net operating loss carryforwards

Allowance for bad debt

Warrants (interest expense)

Warranty Reserve

Capitalized research and development

Total gross deferred taxes

Valuation allowance

( 24,744,527 )

( 20,895,094 )

Net deferred tax assets

Deferred Tax Liabilities:

Inventory and other Reserves

Prepaid expenses

Goodwill amortization

( 1,165,010 )

Total deferred tax liabilities

( 1,882,769 )

deferred tax assets (liabilities)

( 2,306,274 )

Total deferred tax assets (liabilities)

Management has concluded that it is more likely than not that the deferred

tax assets will not be realized and has reduced the asset by a valuation allowance.

22 – DISCONTINUED OPERATIONS

November 22, 2022, the Company entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”)

with the Company’s CEO, Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, which include

the brand SmartDesk, and Cemtrex XR, Inc., which include the brands Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech

(formerly Cemtrex Labs), to Mr.

to the on-going losses and risk associated with the SmartDesk business the Company has valued the royalty and SAFE agreement associated

with the SmartDesk sale at $ 0 and considers such consideration to be a gain contingency.

on sales projections for Cemtrex XR, Inc., the Company does not believe that it will exceed the sales levels required to exceed the $ 820,000

royalties due and has not accounted for any additional royalties at this time.

In accordance with ASC 310 – Receivables, the

Company has discounted the royalties due and during the nine-month ended September 30, 2023, has recognized $ 704,893 of royalties due

and will amortize the remaining amount over the period the royalties are due.

following table summarizes the loss on the sale recorded during fiscal year 2023, included in Income/(loss) from discontinued operations,

net of tax in the accompanying condensed consolidated statement of Operations:

SUMMARY OF LOSS ON SALE

Purchase Price

Less cash and cash equivalents transferred

Less liabilities assumed

Net purchase price

Accounts receivable, net

Inventory, net

Prepaid expenses and other assets

Property and equipment, net

Total assets sold

Liabilities Transferred

Accounts payable

Short-term liabilities

Long-term liabilities

Total liabilities transferred

Net assets sold

Pretax loss on sale of Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc.Companies

$ ( 2,455,341 )

and liabilities included within discontinued operations on the Company’s Condensed Consolidated Balance Sheets at September 30,

2023, and September 30, 2022, are as follows;

OF FINANCIAL STATEMENTS INCLUDED WITHIN DISCONTINUED OPERATIONS

September 30,

Current assets

Cash and equivalents

Trade receivables, net

Inventory –net of allowance for inventory obsolescence

Prepaid expenses and other assets

Total current assets

Property and equipment, net

Current liabilities

Accounts payable

Short-term liabilities

Deposits from customers

Accrued expenses

Total current liabilities

Long-term liabilities

Deferred revenue

Total long-term liabilities

Total liabilities

the first quarter of fiscal 2023, Vicon completed the closure of its discontinued operating entity Vicon Systems, Ltd.

located in Israel.

The Company received funds related to benefit obligations of $ 96,095 , which at the time of operational closure were not guaranteed to

be retrievable.

The company paid $ 7,010 in consulting fees for assistance in retrieving these funds.

The net amount of $ 89,085 is recognized

on the Company’s Condensed Consolidated Income Statement as part of the Loss on Discontinued Operations.

from discontinued operations, net of tax and the loss on sale of discontinued operations, net of tax, of Cemtrex Advanced Technologies,

and Cemtrex XR, Inc., sold during the first quarter of fiscal year 2023, which are presented in total as discontinued operations,

net of tax in the Company’s Condensed Consolidated Statements of Operations for the years ended September 30,

2023 and 2022, are as follows:

Year ended September 30,

Total net sales

Cost of sales

Operating, selling, general and administrative expenses

Other (income)/expenses

Income (loss) from discontinued operations

( 2,673,707 )

Amortization of discounted royalties

Loss on sale of discontinued operations

( 2,455,341 )

Adjustment of benefit obligation

Income tax provision

Discontinued operations, net of tax

$ ( 2,838,053 )

$ ( 2,674,507 )

23 – SUBSEQUENT EVENTS

6 unchanged sentences

of record as of September 29, 2023 .

of subsidiaries to related party

On November 22, 2022, the “Company

entered into two Asset Purchase Agreements and one Simple Agreement for Future Equity (“SAFE”) with the Company’s CEO,

Saagar Govil, to secure the sale of the subsidiaries Cemtrex Advanced Technologies, Inc, and Cemtrex XR, Inc., which include the brands

SmartDesk, Cemtrex XR, Virtual Driver Interactive, Bravo Strong, and good tech (formerly Cemtrex Labs), to Mr.

Govil, which are consolidated

into the Company’s Consolidated Balance Sheet in this report.

November 22, 2022, the Company completed the above disposition for the following consideration.

comprised of:

in cash payable at Closing;

royalty of all revenues on the Business to be paid 90 days after the end of each calendar year for the next three years;

the total sum of royalties due be less than $ 820,000 at the end of the three-year period, Purchaser shall be obligated to pay the

difference between $ 820,000 and the royalties paid .

Advanced Technologies, Inc.

in cash payable at Closing

royalty of all revenues on the Business to be paid 90 days after the end of each calendar year for the next 5 years ;

in SAFE (common equity) at any subsequent fundraising or exit above $5M with a $10M cap .

Company’s Board of Directors, excluding Saagar Govil who abstained from all voting on these agreements, approved these actions

and agreements.

shares issued subsequent to financial statements date

December 16, 2022, 1,365,560 shares of common stock were issued to satisfy $ 200,000 of notes payable and accumulated interest.

Reverse stock split

On December 13, 2022,

the Company’s Board of Directors approved, and stockholders holding at least a majority of the issued and outstanding shares of

our classes of voting stock have approved, by written consent in lieu of a special meeting:

an amendment to our Certificate of Incorporation

to authorize a reverse split of the Company’s outstanding shares of common stock, par value $ 0.001 per share, with a split ratio

of between 1 for 10 and 1 for 100 , which will be determined by the Board of Directors at any time or times for a period of 12 months after

the date of the written consent.

December 13, 2023, 9,853 shares of common stock were issued to satisfy $ 40,000 of accounts payable for services related to a consulting

October 5, 2023, the Company made an additional $ 100,000 investment via a simple agreement for future equity (“SAFE”) in

MasterpieceVR.

The SAFE provides that the Company will automatically receive shares of the entity based on the conversion rate of future

equity rounds up to a valuation cap, as defined.

line of credit and payment of NIL funding term loan

October 5, 2023, the Company obtained a revolving line of credit in the amount of $ 5 Million from Pathward, N.A..

The interest rate will

be a rate which is equal to three percentage points ( 3 %) in excess of that rate shown in the Wall Street Journal as the prime rate (the

“Effective Rate”).

The funds will be used to pay the NIL Funding term loan and to fund operations of the Vicon entity.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures