What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-03-31 compared with 2024-04-01 · 925 added, 678 removed, 338 unchanged (83% of the section changed)

Financial Statements and

Supplementary Data

Index to Financial Statements Required by Article 8 of Regulation S-X:

Audited Financial Statements:

Report of Independent Registered Public Accounting

Firm (PCAOB ID 1013 );

Consolidated Balance Sheets as of December 31, 2023 and 2022;

Consolidated Statements of Operations for the years ended December 31, 2023 and 2022;

Consolidated Statement of Stockholders’ Deficit for the years ended December 31, 2023 and 2022;

Consolidated Statements of Cash Flows for the years ended December 31, 2023 and 2022;

Notes to Consolidated Financial Statements.

of Independent Registered Public Accounting Firm

the Stockholders and Board of Directors iQSTEL, Inc.

on the Consolidated Financial Statements

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

(the “Company”) as of December 31, 2023 and 2022,

the related consolidated statements of operations, changes in stockholders’ equity (deficit), and cash flows for the years then

ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated

financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2023 and 2022, and

the results of its operations and its cash flows for the years then ended , in conformity with accounting principles generally

accepted in the United States of America.

Concern Uncertainty – See Also Critical Audit Matters Section Below

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

in Note 3 to the consolidated financial statements, the Company has suffered recurring losses from operations and does not have an established

Financial Statements and Supplementary Data

to Financial Statements Required by Article 8 of Regulation S-X:

Financial Statements:

Report of Independent

Registered Public Accounting Firm (PCAOB ID 1013 );

Consolidated Balance Sheets

as of December 31, 2024 and 2023;

Consolidated Statements

of Operations for the years ended December 31, 2024 and 2023;

Consolidated Statement

of Stockholders’ Equity (Deficit) for the years ended December 31, 2024 and 2023;

Consolidated Statements

of Cash Flows for the years ended December 31, 2024 and 2023;

Notes to Consolidated Financial

Report of Independent Registered Public

Accounting Firm

To the Stockholders and Board of Directors iQSTEL, Inc.

Coral Gables, FL

Opinion on the Consolidated Financial

We have audited the accompanying

consolidated balance sheets of iQSTEL, Inc.

(the “Company”) as of December 31, 2024 and 2023, the related consolidated statements

of operations, changes in stockholders’ equity (deficit), and cash flows for the years then ended, and the related notes (collectively

referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly,

in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its

cash flows for each of the years then ended , in conformity with accounting principles generally accepted in the United States of

Going Concern Uncertainty –

See Also Critical Audit Matters Section Below

The accompanying consolidated

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

As discussed in Note 3 to the consolidated

financial statements, the Company has suffered recurring losses from operations, negative working capital, and does not have an established

source of revenues sufficient to cover its operating costs, which raise substantial doubt about its ability to continue as a going concern.

2 unchanged sentences

any adjustments that might result from the outcome of this uncertainty.

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

Our responsibility is to express an opinion

on the Company’s consolidated financial statements based on our audits.

We are a public accounting firm registered with the Public

Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company

in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission

and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing

an opinion on the effectiveness of the Company’s internal control over financial reporting.

Basis for Opinion

These consolidated financial statements

are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated

financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board

(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities

laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance

with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether

the consolidated financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to

have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits we are required

to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness

of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether

due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence

regarding the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating the accounting principles

used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Audit Matters

critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements

that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are

material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole,

and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the

accounts or disclosures to which they relate.

Audit Matter Description

recognizes revenue upon transfer of control of promised services to customers in an amount that reflects the consideration the Company

expects to receive in exchange for those services.

judgment is exercised by the Company in determining revenue recognition for customer agreements, and include the pattern of delivery

(i.e., timing of when revenue is recognized) for each distinct performance obligation.

related audit effort in evaluating management’s judgments in determining revenue recognition for customer agreements required a

high degree of auditor judgment.

the Critical Audit Matter was Addressed in the Audit

principal audit procedures related to the Company’s revenue recognition for customer agreements included the following:

gained an understanding of internal controls related to revenue recognition.

evaluated management’s significant accounting policies for reasonableness.

selected a sample of revenues recognized and performed the following procedures:

and read contract source documents for each selection and other documents that were part

Our audits included performing procedures

to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures

that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the

consolidated financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by

management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audits provide

a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated

below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to

be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the consolidated financial

statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of the critical audit matters

does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the

critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they

Revenue Recognition

Critical Audit Matter Description

The Company recognizes revenue upon

transfer of control of promised services to customers in an amount that reflects the consideration the Company expects to receive in exchange

for those services.

Significant judgment is exercised

by the Company in determining revenue recognition for customer agreements, and include the pattern of delivery (i.e., timing of when revenue

is recognized) for each distinct performance obligation.

The related audit effort in

evaluating management’s judgments in determining revenue

recognition for customer agreements

required a high degree of auditor judgment.

How the Critical Audit Matter was Addressed in the Audit

Our principal audit procedures related to the Company’s

revenue recognition for customer

agreements included the following:

• We gained an understanding of internal controls related to revenue recognition.

• We evaluated management’s significant accounting policies for reasonableness.

• We selected a sample of revenues recognized and performed the following procedures:

o Obtained and read contract source documents for each selection and other documents that were part

of the agreement, if applicable.

the terms in the customer agreement and evaluated the appropriateness of management’s

application of their accounting policies, along with their use of estimates, in the determination

of revenue recognition conclusions.

tested the mathematical accuracy of management’s calculations of revenue and the associated

timing of revenue recognized in the financial statements.

confirmed significant customer balances.

o Assessed the terms in the customer agreement and evaluated the appropriateness of management’s

application of their accounting policies, along with their use of estimates, in the determination of revenue recognition conclusions.

o We tested the mathematical accuracy of management’s calculations of

revenue and the associated timing of revenue recognized in the financial

o We confirmed significant customer balances.

Going Concern

Audit Matter Description

described further in Note 3 to the consolidated financial statements, the Company has suffered recurring losses from operations and does

not have an established source of revenues sufficient to cover its operating costs.

The ability of the Company to continue as a going

concern is dependent upon its ability to successfully accomplish its business plan and eventually attain profitable operations.

the Company has determined that these factors raise substantial doubt as to the Company’s ability to continue as a going concern

for a period of one year from the issuance of these financial statements.

Management intends to continue to fund its business by way

of public or private offerings of the Company’s stock or through loans from private investors, in order satisfy the Company’s

obligations as they come due for at least one year from the financial statement issuance date.

However, the Company has not concluded

that these plans alleviate the substantial doubt related to its ability to continue as a going concern.

the Critical Audit Matter was Addressed in the Audit

We determined

the Company’s ability to continue as a going concern is a critical audit matter due to the estimation and uncertainty regarding

the Company’s available capital and the risk of bias in management’s judgments and assumptions in their determination.

audit procedures related to the Company’s assertion on its ability to continue as a going concern included the following, among

performed testing procedures such as analytical procedures to identify conditions and events

that indicate that there could be substantial doubt about the Company’s ability to

continue as a going concern for a reasonable period of time.

reviewed and evaluated management's plans for dealing with adverse effects of these conditions

inquired of Company management and reviewed company records to assess whether there are additional

Critical Audit Matter Description

As described further in Note 3 to

the consolidated financial statements, the Company has suffered recurring losses from operations, negative working capital, and does not

have an established source of revenues sufficient to cover its operating costs.

The ability of the Company to continue as a going concern

is dependent upon its ability to successfully accomplish its business plan and eventually attain profitable operations.

Accordingly, the

Company has determined that these factors raise substantial doubt as to the Company’s ability to continue as a going concern for

a period of one year from the issuance of these financial statements.

Management intends to continue to fund its business by way of public

or private offerings of the Company’s stock or through loans from private investors, in order satisfy the Company’s obligations

as they come due for at least one year from the financial statement issuance date.

However, the Company has not concluded that these plans

alleviate the substantial doubt related to its ability to continue as a going concern.

How the Critical Audit Matter was Addressed

We determined the Company’s

ability to continue as a going concern is a critical audit matter due to the estimation and uncertainty regarding the Company’s

available capital and the risk of bias in management’s judgments and assumptions in their determination.

Our audit procedures related

to the Company’s assertion on its ability to continue as a going concern included the following, among others:

We performed testing procedures such as analytical procedures to identify conditions and events

that indicate that there could be substantial doubt about the Company’s ability to continue as a going concern for a reasonable

period of time.

We reviewed and evaluated management's plans for dealing with adverse effects of these conditions

We inquired of Company management and reviewed company records to assess whether there are additional

factors that contribute to the uncertainties disclosed.

assessed whether the Company’s determination that there is substantial doubt about

its ability to continue as a going concern was adequately disclosed.

Popeck & Co., LLC

have served as the Company's auditor since 2020.

• We assessed whether the Company’s determination that there is substantial

about its ability to continue as a going concern was adequately

/s/ Urish Popeck & Co.

We have served as the Company's auditor since

Pittsburgh, Pennsylvania

March 31, 2025

Balance Sheets

receivable, net

from related parties

and other current assets

Current Assets

and equipment, net

AND STOCKHOLDERS' EQUITY

and other current liabilities

to related parties

payable - net of discount of $ 32,334

payable - related parties

note - net of discount of $ 10,428

Accounts receivable, net

Due from related parties

Prepaid and other current assets

Total Current Assets

Property and equipment, net

Intangible assets

Deferred tax assets

LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities

payable, non-current

benefits, non-current

Stockholders'

Accounts payable

Accrued and other current liabilities

Due to related parties

Loans payable - net of discount of $ 62,898 and $ 3,750 , respectively

Loans payable - related parties

Convertible notes - net of discount of $ 138,654 and $ 39,012 , respectively

Contingent liability for acquisition of subsidiary

Total Current Liabilities

Convertible notes - net of discount of $ 210,296 and $ 0 , respectively

Loans payable, non-current

Employee benefits, non-current

TOTAL LIABILITIES

Stockholders' Equity

Preferred stock:

1,200,000 authorized;

A Preferred stock:

shares issued and outstanding

B Preferred stock:

$ 0.001 par value

shares issued and outstanding, respectively

C Preferred stock:

par value, No

shares issued and outstanding

D Preferred stock:

par value, No

Series A Preferred stock:

10,000 shares issued and outstanding

Series B Preferred stock:

200,000 designated;

$ 0.001 par value,

35,537 and 31,080 shares issued and outstanding, respectively

Series C Preferred stock:

200,000 designated;

$ 0.001 par value, No shares issued and outstanding

Series D Preferred stock:

75,000 designated;

$ 0.001 par value, No shares issued and outstanding

Common stock:

300,000,000 authorized;

172,129,630 and

161,595,511 shares

issued and outstanding, respectively

paid in capital

$ 0.001 par value

202,976,685 and 172,129,630 shares issued and outstanding, respectively

Additional paid in capital

Accumulated deficit

( 32,703,410 )

( 26,084,133 )

other comprehensive loss

attributed to stockholders of iQSTEL Inc.

attributable to noncontrolling interests

STOCKHOLDERS' EQUITY

LIABILITIES AND STOCKHOLDERS' EQUITY

Accumulated other comprehensive loss

Equity attributed to stockholders of iQSTEL Inc.

Equity (Deficit) attributable to noncontrolling interests

TOTAL STOCKHOLDERS' EQUITY

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

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

Consolidated Statements

of Operations

Statements of Operations

$ 283,220,442

and administration

$ 144,502,351

Cost of revenue

Operating expenses

General and administration

Total operating expenses

Operating loss

Other income (expense)

Other expenses

Interest expense

( 2,159,425 )

income (expense)

in fair value of derivative liabilities

Change in fair value of derivative liabilities

( 1,393,046 )

other income (expense)

Loss on settlement of debt

Total other (expense) income

( 3,951,942 )

loss before provision for income taxes

Net loss before provision for income taxes

( 4,786,006 )

1 unchanged sentence

Net income attributable to noncontrolling interests

loss attributed to iQSTEL Inc.

Net loss attributed to iQSTEL Inc.

$ ( 5,991,567 )

$ ( 763,258 )

on Series B Preferred Stock

loss attributed to stockholders of iQSTEL Inc.

Dividend on Series B Preferred Stock

Net loss attributed to stockholders of iQSTEL Inc.

$ ( 6,619,277 )

$ ( 1,579,738 )

Comprehensive

income (loss)

Comprehensive loss

$ ( 5,180,036 )

$ ( 219,436 )

currency adjustment

comprehensive loss

Foreign currency adjustment

$ ( 5,180,036 )

1 unchanged sentence

Comprehensive income attributable to noncontrolling interests

comprehensive loss attributed to iQSTEL Inc.

Net comprehensive loss attributed to iQSTEL Inc.

$ ( 5,991,567 )

$ ( 755,041 )

and diluted loss per common share

average number of common shares outstanding - Basic and diluted

The accompanying notes are

an integral part of these consolidated financial statements.

Consolidated Statements

of Changes in Stockholders’ Equity (Deficit)

For the years ended December

31, 2023 and 2022

Basic and diluted loss per common share

Weighted average number of common shares outstanding - Basic and diluted

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

Consolidated Statements of Changes in Stockholders’

Equity (Deficit)

For the years ended December 31, 2024 and 2023

Series A Preferred Stock

Series B Preferred Stock

Paid in Capital

Other Comprehensive Loss

Controlling Interest

Stockholders’ Deficit

- December 31, 2021

$ 18,536,921 )

$ ( 996,013 )

stock issued for cash

stock issued for acquisitions of subsidiaries

stock issued for asset acquisition

stock issued for compensation

stock issued for settlement of debt

stock issued for warrant exercises

stock payable

of derivative liabilities upon exercise of warrants

currency translation adjustments

(loss) income

( 5,967,474 )

( 5,865,761 )

Additional Paid in Capital

Accumulated Deficit

Accumulated Other Comprehensive Loss

Non Controlling Interest

Total Stockholders' Equity

- December 31, 2022

10 unchanged sentences

$ ( 377,710 )

The accompanying notes are

an integral part of these consolidated financial statements.

Consolidated Statements

of Cash Flows

Series B Preferred stock issued as dividend

Common stock issued for compensation

Common stock issued for settlement of debt

Common stock issued for conversion of debt

Common stock issued in conjunction with convertible notes

Common stock issued for the extension of debt

Common stock issued for warrant exercises

Common stock issued for conversion of series B preferred stock

Common stock issued for cash

Resolution of derivative liabilities upon exercise of warrant

Common stock payable

Acquisition of subsidiary

Net income (loss)

( 5,991,567 )

( 5,180,036 )

Balance - December 31, 2024

$ ( 32,703,410 )

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

Statements of Cash Flows

CASH FLOWS FROM OPERATING ACTIVITIES:

8 unchanged sentences

Change in fair value of derivative liabilities

Loss on settlement of debt

Deferred tax assets

2 unchanged sentences

( 56,091,437 )

Prepaid and other current assets

( 8,010,726 )

Prepaid and other assets

( 1,235,127 )

( 1,085,279 )

Due from related parties

5 unchanged sentences

CASH FLOWS FROM INVESTING ACTIVITIES:

Acquisitions of subsidiaries, net of cash acquired

Acquisitions of subsidiary, net of cash acquired

( 2,955,121 )

Purchase of property and equipment

Advances of loan receivable - related party

Advance of loan receivable - related party

Collection of amounts due from related parties

4 unchanged sentences

Repayments of loans payable

( 1,846,139 )

Proceeds from loans payable - related parties

Repayment of loans payable - related parties

Proceeds from common stock issued

1 unchanged sentence

Proceeds from convertible notes

Deposit for option

Proceeds from common stock payable

Repayment of convertible notes

2 unchanged sentences

Net change in cash

( 2,005,424 )

Cash, beginning of period

4 unchanged sentences

Non-cash transactions:

Common Stock payable

Series B Preferred stock issued as dividend

Common stock issued for asset acquisition

Common stock issued for acquisitions of subsidiaries

Common stock issued in connection with convertible notes

Common stock issued for conversion of debt

Common stock issued for exercise of cashless warrants

Common stock issued for settlement of debt

Common stock issued for modification of debts

Common stock issued for conversion of preferred stock

Cashless warrant exercised

Non-cash dividend for collection of loan receivable - related parties

Resolution of derivative liabilities upon exercise of warrants

The accompanying notes are

an integral part of these consolidated financial statements.

Notes to the Consolidated

Financial Statements

Resolution of derivative liabilities upon exercise of warrant

Note payable issued for acquisition of subsidiary

Contingent liability for acquisition of subsidiary

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

Notes to the Consolidated Financial Statements

December 31, 2024

NOTE 1 -ORGANIZATION

AND DESCRIPTION OF BUSINESS

NOTE 1 -ORGANIZATION AND DESCRIPTION OF BUSINESS

and Operations

(“iQSTEL”, “we”, “us”, or the “Company”) was incorporated under the laws of the State

of Nevada on June 24, 2011 under the name of B-Maven Inc.

(“iQSTEL”, “we”, “us”, or the “Company”) was incorporated under the laws of the

State of Nevada on June 24, 2011 under the name of B-Maven Inc.

The Company changed its name to PureSnax International,

2 unchanged sentences

on August 7, 2018.

has been engaged in the business of telecommunication services as a wholesale carrier of voice, SMS and data for other telecom companies

around the World with over 400 active interconnection agreements with mobile companies, fixed

line companies and other wholesale carriers.

On May 13, 2022, we entered into a Company Acquisition

Agreement regarding the acquisition of 51 % of the shares in Whisl telecom LLC (“Whisl”) .

On June 1, 2022, we entered into a Company Acquisition

Agreement regarding the acquisition of 51 % of the shares in Smartbiz Telecom LLC

(“Smartbiz”).

Both acquisitions

are detailed in Note 4.

NOTE 2 -SUMMARY

OF SIGNIFICANT ACCOUNTING POLICIES

Company has been engaged in the business of telecommunication services as a wholesale carrier of voice, SMS and data for other telecom

companies around the World with over 603 active interconnection agreements with mobile companies, fixed line companies and

other wholesale carriers.

Company is a technology company with presence in 20 countries and approximately 100 employees that is offering leading-edge services

through its four business divisions.

Telecom Division, which represents the majority of current operations and which also represents the source for all of the Company’s

revenues, offers VoIP, SMS, proprietary Internet of Things (IoT) solutions (www.iotsmartgas.com and www.iotsmarttank.com), and international

fiber-optic connectivity through its subsidiaries:

Etelix.com USA, LLC, SwissLink Carrier AG, Smartbiz Telecom LLC, Whisl Telecom LLC,

IoT Labs, LLC, QGlobal SMS, LLC, and QXTEL LIMITED.

under the Telecom Division, the Company’s developing BlockChain Platform Business Line offers our proprietary Mobile Number Portability

Application (MNPA) to serve the in-country portability needs through its subsidiary, itsBchain, LLC.

Company’s developing Fintech Business Line offers a complete Fintech ecosystem MasterCard Debit Card, US Bank Account (No SSN Needed),

Mobile App/Wallet (Remittances, Mobile Top Up).

The Company’s Fintech subsidiary, Global Money One Inc., is to provide immigrants

access to reliable financial services that makes it easier to manage their money and stay connected with their families back home.

Company’s developing Electric Vehicle (EV) Business Line offers electric motorcycles for work and recreational use in the USA,

Spain, Portugal, Panama, Colombia, and Venezuela.

EVOSS is also working on the development of an EV Mid Speed Car to serve the niche

of the 2nd car in the family.

Company’s developing Artificial Intelligence (AI)-Enhanced Metaverse Division offers a white-label solution designed specifically

for corporations, businesses, and the telecommunications industry.

Delivering a full suite of immersive content services, creating a

comprehensive virtual experience that can be accessed through the Web or our proprietary mobile apps.

-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

of Presentation

The consolidated

financial statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission

The financial statements have been prepared in accordance with Generally Accepted Accounting Principles (“GAAP”)

of the United States of America.

consolidated financial statements and related disclosures have been prepared pursuant to the rules and regulations of the Securities

and Exchange Commission (“SEC”).

The financial statements have been prepared in accordance with Generally Accepted Accounting

Principles (“GAAP”) of the United States of America.

The Company’s fiscal year end is December 31.

Reclassification

amounts have been reclassified to improve the clarity and comparability of the financial statements.

These reclassifications had no effect

on the reported results of operations.

Consolidation

The consolidated

financial statements of the Company include the accounts of the Company and its owned subsidiaries, Etelix.com USA, LLC (“Etelix”),

SwissLink Carrier AG (“Swisslink”), ITSBCHAIN, LLC (“ItsBchain”), QGLOBAL SMS, LLC (“QGlobal”), IoT

Labs, LLC (“IoT Labs”), Global Money One Inc (“Global Money One”), Whisl Telecom LLC (“Whisl”) and

Smartbiz Telecom LLC (“Smartbiz”).

All significant intercompany balances and transactions have been eliminated in consolidation.

The preparation

of the consolidated financial statements in conformity with GAAP in the United States of America requires management to make estimates

and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the

date of the financial statements.

consolidated financial statements of the Company include the accounts of the Company and its owned subsidiaries, Etelix.com USA, LLC

(“Etelix”), SwissLink Carrier AG (“Swisslink”), ITSBCHAIN, LLC (“ItsBchain”), QGLOBAL SMS, LLC (“QGlobal”),

IoT Labs, LLC (“IoT Labs”), Global Money One Inc (“Global Money One”), Whisl Telecom LLC (“Whisl”),

Smartbiz Telecom LLC (“Smartbiz”) and QXTEL LIMITED (“QXTEL”).

All significant intercompany balances and transactions

have been eliminated in consolidation.

preparation of the consolidated financial statements in conformity with GAAP in the United States of America requires management to make

estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities

at the date of the financial statements.

The estimates and judgments will also affect the reported amounts for certain revenues and expenses

1 unchanged sentence

Actual results could differ from these good faith estimates and judgments.

In accordance

with ASC 805-10, “ Business Combinations ”, the Company accounts for all business combinations using the acquisition

method of accounting.

Under this method, assets and liabilities, including any remaining non-controlling interests, are recognized at

fair value at the date of acquisition.

The excess of the purchase price over the fair value of assets acquired, net of liabilities assumed,

and non-controlling interests is recognized as goodwill.

Certain adjustments to the assessed fair values of the assets, liabilities, or

non-controlling interests made subsequent to the acquisition date, but within the measurement period, which is up to one year, are recorded

as adjustments to goodwill.

accordance with ASC 805-10, “ Business Combinations ”, the Company accounts for all business combinations using the

acquisition method of accounting.

Under this method, assets and liabilities, including any remaining non-controlling interests, are recognized

at fair value at the date of acquisition.

The excess of the purchase price over the fair value of assets acquired, net of liabilities

assumed, and non-controlling interests is recognized as goodwill.

Certain adjustments to the assessed fair values of the assets, liabilities,

or non-controlling interests made subsequent to the acquisition date, but within the measurement period, which is up to one year, are

recorded as adjustments to goodwill.

Any adjustments subsequent to the measurement period are recorded in income.

Any cost or equity method interest

that the Company holds in the acquired company prior to the acquisition is re-measured to fair value at acquisition with a resulting gain

or loss recognized in income for the difference between fair value and the existing book value.

Results of operations of the acquired

entity are included in the Company’s results from the date of the acquisition onward and include amortization expense arising from

acquired tangible and intangible assets.

Any cost or equity

method interest that the Company holds in the acquired company prior to the acquisition is re-measured to fair value at acquisition with

a resulting gain or loss recognized in income for the difference between fair value and the existing book value.

Results of operations

of the acquired entity are included in the Company’s results from the date of the acquisition onward and include amortization expense

arising from acquired tangible and intangible assets.

Currency Translation and Re-measurement

translates its foreign operations to U.S.

Company translates its foreign operations to U.S.

dollars in accordance with ASC 830, “ Foreign Currency Matters ”.

The functional

currency and reporting currency of Etelix, QGlobal, ItsBchain, IoT Labs, Whisl, Smartbiz and Global Money One is the U.S.

dollar, while

SwissLink’s functional currency is the Swiss Franc (“CHF”).

SwissLink translates

their records into U.S.

dollars as follows:

Assets and liabilities at the rate of exchange in effect at the balance sheet date

Equities at historical rate

Revenue and expense items at the average rate of exchange prevailing during the period

arising from such translations are included in accumulated other comprehensive income (loss) in stockholders’ equity.

Cash Equivalents

Cash and cash

equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three months from

inception, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant

risk of loss in value.

The functional currency and reporting currency of Etelix, QGlobal, ItsBchain, IoT Labs, Whisl, Smartbiz, Global Money One and QXTEL is

dollar, while SwissLink’s functional currency was the Swiss Franc (“CHF”).

As of January 1, 2024, we changed

the functional currency of SwissLink from their respective local currency to the US dollar.

The change in functional currency is due

to increased exposure to the US dollar as a result of a change in facts and circumstances in the primary economic environment in which

this subsidiary operates.

The effects of the change in functional currency were not significant to our consolidated financial statements.

and Cash Equivalents

and cash equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three

months from inception, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to

an insignificant risk of loss in value.

The Company had no cash equivalents at December 31, 2024 and 2023.

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credit losses in its existing accounts receivable.

The Company estimates expected credit losses related to accounts receivable

balances based on a review of available and relevant information including current economic conditions, projected economic conditions,

historical loss experience, account aging, and other factors that could affect collectability.

the years ended December 31, 2023 and 2022, the Company recorded bad debt expense of $ 8,815 and $ 34,376 , respectively.

The Company estimates expected credit losses related to accounts receivable balances

based on a review of available and relevant information including current economic conditions, projected economic conditions, historical

loss experience, account aging, and other factors that could affect collectability.

During the years ended December 31, 2024 and

2023, the Company recorded bad debt expense of $ 1,991 and $ 8,815 , respectively.

consisting of smart gas parts, are primarily accounted for using the first-in-first-out (“FIFO”) method of accounting.

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assessment of expected sales prices.

Long-lived assets

are evaluated for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may

not be fully recoverable or that the useful lives of these assets are no longer appropriate.

assets are evaluated for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets

may not be fully recoverable or that the useful lives of these assets are no longer appropriate.

Each impairment test is based on a comparison

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estimated fair value.

Fixed assets,

consisting of telecommunications equipment and software, are recorded at cost reduced by accumulated depreciation and amortization.

and amortization expense is recognized over the assets’ estimated useful lives of 3 years for computers and laptops;

assets, consisting of telecommunications equipment and software, are recorded at cost reduced by accumulated depreciation and amortization.

Depreciation and amortization expense is recognized over the assets’ estimated useful lives of 3 - 4 years for

computers and laptops;

4 - 5 years for telecommunications equipment and switches;

and 5 years for software using the straight-line method.

Major additions

and improvements are capitalized as additions to the property and equipment accounts, while replacements, maintenance and repairs that

do not improve or extend the life of the respective assets are expensed as incurred.

Estimated useful lives are periodically reviewed

and, when appropriate, changes are made prospectively.

When certain events or changes in operating conditions occur, asset lives may be

adjusted and an impairment assessment may be performed on the recoverability of the carrying amounts.

and 5 years for software using

the straight-line method.

Major additions and improvements are capitalized as additions to the property and equipment accounts, while

replacements, maintenance and repairs that do not improve or extend the life of the respective assets are expensed as incurred.

useful lives are periodically reviewed and, when appropriate, changes are made prospectively.

When certain events or changes in operating

conditions occur, asset lives may be adjusted and an impairment assessment may be performed on the recoverability of the carrying amounts.

assets represent mainly the interconnection agreements acquired from the acquisition of QXTEL.

The acquired intangible asset was recognized

and measured at fair value at the time of acquisition and is amortized on a straight-line basis over the estimated economic useful life

of the respective asset.

The estimated useful life of the acquired interconnection agreements is 16 years .

of tangible and intangible assets

intangible assets (excluding goodwill) are assessed at each reporting date for indications that an asset may be impaired.

indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the asset's recoverable

and intangible assets (excluding goodwill) are assessed at each reporting date for indications that an asset may be impaired.

such indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the asset's recoverable

The asset's recoverable amount is the higher of an asset's or cash-generating unit's fair value less costs of disposal and its

value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of

those from other assets or groups of assets.

value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent

of those from other assets or groups of assets.

Where the carrying amount of an asset or a group of assets exceeds its recoverable amount,

the asset is considered impaired and is written down to its recoverable amount.

In assessing value in use, the estimated future cash flows

are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money

and the risks specific to the asset or the group of assets.

goodwill to reporting units based on the reporting unit expected to benefit from the business combination.

We evaluate our reporting units

on an annual basis and, if necessary, reassign goodwill using a relative fair value allocation approach.

Goodwill is tested for impairment

at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual tests if

an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value.

These events or circumstances could include a significant change in the business climate, legal factors, operating performance indicators,

competition, or sale or disposition of a significant portion of a reporting unit.

In assessing value in use, the estimated future cash

flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value

of money and the risks specific to the asset or the group of assets.

allocate goodwill to reporting units based on the reporting unit expected to benefit from the business combination.

We evaluate our reporting

units on an annual basis and, if necessary, reassign goodwill using a relative fair value allocation approach.

Goodwill is tested for

impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis and between annual

tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its

carrying value.

These events or circumstances could include a significant change in the business climate, legal factors, operating performance

indicators, competition, or sale or disposition of a significant portion of a reporting unit.

of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities

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for our business, estimation of the useful life over which cash flows will occur, and determination of our weighted average cost of capital.

The estimates

used to calculate the fair value of a reporting unit change from year to year based on operating results, market conditions, and other

Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment for

each reporting unit.

estimates used to calculate the fair value of a reporting unit change from year to year based on operating results, market conditions,

and other factors.

Changes in these estimates and assumptions could materially affect the determination of fair value and goodwill impairment

for each reporting unit.

The following

table provides a summary of changes in the carrying amounts of goodwill

January 1, 2023

Balance at December 31,

Benefit Costs

defined contribution retirement benefit schemes for SwissLink are charged as an expense as they fall due.

to defined contribution retirement benefit schemes for SwissLink are charged as an expense as they fall due.

Payments made to state-managed

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schemes are equivalent to those arising in a defined contribution retirement benefit scheme.

benefit schemes, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being

carried out at each balance sheet date.

defined benefit schemes, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations

being carried out at each balance sheet date.

Actuarial gains and losses are recognized in full in the period in which they occur.

recognized outside the income statement and are presented in other comprehensive income.

Past service cost is recognized immediately in

the income statement in the period in which it occurs.

The retirement

benefit obligation recognized in the balance sheet represents the present value of the defined obligation as adjusted for unrecognized

past service cost, and as reduced by the fair value of the scheme assets.

Any asset resulting from this calculation is limited to past

service cost, plus the present value of available refunds and reductions in future contributions to the scheme.

(Loss) Per Share of Common Stock

has adopted ASC 260, ”Earnings per Share” which requires presentation of basic earnings per share on the

face of the statements of operations for all entities with complex capital structures and requires a reconciliation of the numerator and

denominator of the basic earnings per share computation.

In the accompanying financial statements, basic loss per share is computed by

dividing net loss by the weighted average number of shares of common stock outstanding during the year.

Diluted earnings per 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

are recognized outside the income statement and are presented in other comprehensive income.

Past service cost is recognized immediately

in the income statement in the period in which it occurs.

retirement benefit obligation recognized in the balance sheet represents the present value of the defined obligation as adjusted for

unrecognized past service cost, and as reduced by the fair value of the scheme assets.

Any asset resulting from this calculation is limited

to past service cost, plus the present value of available refunds and reductions in future contributions to the scheme.

Income (Loss) Per Share of Common Stock

Company has adopted ASC 260, ” Earnings per Share ” which requires presentation of basic earnings per share

on the face of the statements of operations for all entities with complex capital structures and requires a reconciliation of the numerator

and denominator of the basic earnings per share computation.

In the accompanying financial statements, basic loss per share is computed

by dividing net loss by the weighted average number of shares of common stock outstanding during the year.

Diluted earnings per 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 unless the result would be antidilutive.

Dilutive potential common shares include outstanding

Series B Preferred stock, and it was excluded from the computation of diluted net loss per share as the result was anti-dilutive for the

years ended December 31, 2023 and 2022.

Series B Preferred stock, and it was excluded from the computation of diluted net loss per share as the result was anti-dilutive for

the years ended December 31, 2024 and 2023.

Concentrations

of Credit Risk

The Company’s

financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents and related

party payables.

The Company places its cash and cash equivalents with financial institutions of high creditworthiness.

At times, its cash

and cash equivalents with a particular financial institution may exceed any applicable government insurance limits.

During the year ended December 31, 2023, 12 customers

represented 89 % of our revenue compared to 12 customers representing 88 % of our revenue for the year ended December

For the years ended December 31, 2023 and 2022, 52 % and 57 % of the revenue comes from customers under prepayment conditions

which means there is no credit or bad debt risk on that portion of the customers portfolio.

follows ASC 820, “ Fair Value Measurements and Disclosures, ” which defines fair value as the exchange price that would

be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or

liability in an orderly transaction between market participants on the measurement date.

ASC 820 also establishes a fair value hierarchy

that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable

inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available

in the circumstances (unobservable inputs).

The fair value hierarchy consists of three broad levels, which gives the highest priority

to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs

Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents,

accounts receivable, and related party payables.

The Company places its cash and cash equivalents with financial institutions of high

creditworthiness.

At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government

insurance limits.

During the year ended December 31, 2024, we had 27 customers representing 89 % of our revenue compared to 12 customers representing 89 %

of our revenue for the year ended December 31, 2023.

For the years ended December 31, 2024 and 2023, 33 % and 52 % of revenue, respectively,

comes from customers under prepayment conditions, which means there are no credit or bad debt risks on that portion of the customers’

Company follows ASC 820, “ Fair Value Measurements and Disclosures, ” which defines fair value as the exchange price

that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for

the asset or liability in an orderly transaction between market participants on the measurement date.

ASC 820 also establishes a fair

value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent

sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best

information available in the circumstances (unobservable inputs).

The fair value hierarchy consists of three broad levels, which gives

the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority

to unobservable inputs (Level 3).

The three levels of the fair value hierarchy are described below:

Level 1 applies

to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2 applies

to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted

prices for similar assets or liabilities in active markets;

quoted prices for identical assets or liabilities in markets with insufficient

volume or infrequent transactions (less active markets);

or model-derived valuations in which significant inputs are observable or can

be derived principally from, or corroborated by, observable market data.

Level 3 applies

to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement

1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability

such as quoted prices for similar assets or liabilities in active markets;

quoted prices for identical assets or liabilities in markets

with insufficient volume or infrequent transactions (less active markets);

or model-derived valuations in which significant inputs are

observable or can be derived principally from, or corroborated by, observable market data.

3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement

of the fair value of the assets or liabilities.

values of our financial instruments, including, cash;

carrying values of our financial instruments, including, cash;

accounts receivable;

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accounts payable;

liabilities and other current liabilities;

and due from/to related parties approximate their fair values due to the short-term maturities

of these financial instruments.

accrued liabilities and other current liabilities;

and due from/to related parties approximate their fair values due to the short-term

maturities of these financial instruments.

involving related parties cannot be presumed to be carried out on an arm’s-length basis, as the requisite conditions of competitive,

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Financial Instruments

does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks.

We evaluate all of our financial

instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives.

For derivative

financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is

then re-valued at each reporting date, with changes in the fair value reported in the statements of operations.

For stock-based derivative

financial instruments, the Company used a Black Scholes valuation model to value the derivative instruments at inception and on subsequent

valuation dates.

The classification of derivative instruments, including whether such instruments should be recorded as liabilities or

as equity, is evaluated at the end of each reporting period.

Derivative liabilities are classified in the balance sheet as current or

non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months of the balance

uses the liability method of accounting for income taxes.

Under the liability method, deferred tax assets and liabilities are determined

based on differences between financial reporting and the tax basis of assets, liabilities, the carry forward of operating losses and tax

credits, and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse.

allowance against deferred tax assets is recorded when it is more likely than not that such tax benefits will not be realized.

Company does not use derivative instruments to hedge exposures to cash flow, market or foreign currency risks.

We evaluate all of our

financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives.

derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value

and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations.

For stock-based

derivative financial instruments, the Company used a Black Scholes valuation model to value the derivative instruments at inception and

on subsequent valuation dates.

The classification of derivative instruments, including whether such instruments should be recorded as

liabilities or as equity, is evaluated at the end of each reporting period.

Derivative liabilities are classified in the balance sheet

as current or non-current based on whether or not net-cash settlement or conversion of the instrument could be required within 12 months

of the balance sheet date.

Company uses the liability method of accounting for income taxes.

Under the liability method, deferred tax assets and liabilities are

determined based on differences between financial reporting and the tax basis of assets, liabilities, the carry forward of operating

losses and tax credits, and are measured using the enacted tax rates and laws that will be in effect when the differences are expected

An allowance against deferred tax assets is recorded when it is more likely than not that such tax benefits will not be realized.

follows ASC 850, “Related Party Disclosures” for the identification of related parties and disclosure of

related party transactions (see Note 15).

recognizes revenue from telecommunication services in accordance with ASC 606, “ Revenue from Contracts with Customers.”

recognizes revenue related to monthly usage charges and other recurring charges during the period in which the telecommunication services

are rendered, provided that persuasive evidence of a sales arrangement exists, and collection is reasonably assured.

Management considers

persuasive evidence of a sales arrangement to be a written interconnection agreement.

The Company’s payment terms vary by client.

Costs of revenue

represent direct charges from vendors that the Company incurs to deliver services to its customers.

These costs primarily consist of usage

charges for calls terminated in vendors’ networks.

leases office space for corporate and network monitoring activities and to house telecommunications equipment.

In accordance

with ASC 842, “ Leases, ” we determine if an arrangement is a lease at inception.

The office lease

meets the definition of a short-term lease because the lease term is 12 months or less.

Company recognizes revenue related to monthly usage charges and other recurring charges during the period in which the telecommunication

services are rendered, provided that persuasive evidence of a sales arrangement exists, and collection is reasonably assured.

considers persuasive evidence of a sales arrangement to be a written interconnection agreement.

The Company’s payment terms vary

charges refer to the fees that customers are billed based on their actual usage of the services.

For voice services, this typically means

charges based on the duration of calls made.

For SMS (text messaging), it usually means charges per message sent.

Other recurring charges

are referred to charges for services such as (1) Global DIDs, (2) Global Toll-Free Numbers, (3) PBX (Private Branch Exchange) for small

businesses, and (4) SIP Trunking.

The provision of these services usually has set-up fees and are offered on a subscription or month-to-month

is reported on a gross basis since the Company acts as the principal in the transaction, meaning it has control over the goods or services

before they are transferred to the customer.

This includes having the primary responsibility for fulfilling the contract and determining

respect to the specific performance obligations of the Company in its contracts with its customers, our standard service agreement establishes

the following:

The Company agrees to furnish to Customer, and Customer agrees to purchase from the Company, International Long Distance telecommunication services and/or SMS services at the rates agreed to in writing by the Parties.

The Company will provide, operate and maintain communications equipment, international links and network administration and support in the United States and other countries as may be agreed upon.

The Company will be responsible for its own expenses and will provide, operate, and maintain transmission facilities required to link its domestic network with the other Party's nearest point of presence (POP).

The Company shall provide Customer all required IP network addresses, Domain Name Server (DNS) information and, if necessary, the associated prefixes used to exchange voice traffic as provided on the provisioning form.

The Company shall take all appropriate security measures to protect its network from fraudulent traffic coming from unknown or unauthorized sources.

Any and all IP and network information received by the Company from Customer for the purposes of this agreement shall be held in strict confidentiality, and disclosed only to those employees or personnel with a need to know.

Company recognizes revenue from telecommunication services in accordance with ASC 606.

Topic 606 establishes a comprehensive 5 step framework

for determining revenue recognition.

Under this framework, the Company considers each service a single performance obligation, since

typically, the Company provides a series of distinct services.

application of the 5 step Topic 606 revenue recognition framework to the Company's operations is depicted as follows:

606 Conceptual Framework

Company Policy & Procedures

1 Identify the contract(s) with customer

contract is defined as an approved mutual agreement between the Company and a customer setting

performance obligation, and criteria that must be met in accordance with the Company's customary

commercial business practices and entered into with the probable expectation that all estimated

consideration will be realized in the ordinary course of business.

2 Identify the performance obligations

obligations are identified in the customer agreement, and any subsequent amendments stated in per minute, time and message usage

The Company considers each service a single performance obligation, including instances where the Company provides a series

of services that are substantially the same and have the same pattern of transfer.

3 Determine the transaction price

The transaction

price is determined at contract inception and is subsequently reviewed periodically to reflect applicable rate amendments, trends

in regulatory, market conditions and usage of service by a customer.

The transaction price excludes amounts collected on behalf of

third parties such as sales taxes and regulatory fees.

Allocate the transaction price to the performance obligations

The transaction

price is allocated to each performance obligation based on the standalone contractual selling price of the time measured service,

net of any related discount.

5 Recognize revenue when the entity satisfies a performance obligation

Company recognizes revenues from contracts with customers when control of the usage of the services has been transferred to the customer,

as recorded and measured by the Company's internal information systems.

Revenues are recognized at the probable amount of consideration

expected in exchange for transferring control of usage.

of revenue represent direct charges from vendors that the Company incurs to deliver services to its customers.

These costs primarily

consist of usage charges for calls terminated in vendors’ networks.

Company leases office space for corporate and network monitoring activities and to house telecommunications equipment.

accordance with ASC 842, “ Leases, ” we determine if an arrangement is a lease at inception.

office lease meets the definition of a short-term lease because the lease term is 12 months or less.

Consequently, consistent with Company’s

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Accounting Pronouncements

In June 2022,

the FASB issued ASU 2022-03, ASC Subtopic “ Fair Value Measurement (Topic 820):

Fair Value Measurement of Equity Securities Subject

to Contractual Sale Restrictions.

” These amendments clarify that a contractual restriction on the sale of an equity security

is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value.

The amendments

in this update are effective for public business entities for fiscal years, including interim periods within those fiscal years, beginning

after December 15, 2023.

Early adoption is permitted.

The Company is currently assessing the impact of the adoption of this standard on

its consolidated financial statements.

November 2024, the FASB issued ASU 2024-03 Final Standard on Income Statement:

Disaggregation of Income Statement Expenses , which

requires disaggregated disclosure of income statement expenses for public business entities.

ASU does not change the expense captions an entity presents on the face of the income statement;

rather, it requires disaggregation of

certain expense captions into specified categories in disclosures within the footnotes to the financial statements.

This guidance will

be effective for us on January 1, 2027.

The Company is currently evaluating the impact of adopting ASU 2024-03.

Company has reviewed all other recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption

of any such pronouncements may be expected to cause a material impact on our financial statements.

adopted accounting standards

November 2023, the FASB issued ASU 2023-07, Segment Reporting, which improves reportable segment disclosure requirements primarily

through enhanced disclosures about significant segment expenses among other disclosure requirements.

ASU 2023-07 is effective for fiscal

years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

Early adoption is

The Company adopted ASU 2023-07 on January 1, 2024.

The amendments were applied retrospectively to all prior periods presented

in the accompanying financial statements.

The adoption of ASU 2023-07 has not had a material effect on the Company’s statements

and disclosures.

- GOING CONCERN

The Company's

consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the

realization of assets and liquidation of liabilities in the normal course of business.

Company's consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates

the realization of assets and liquidation of liabilities in the normal course of business.

The Company has suffered recurring losses

from operations and does not have an established source of revenues sufficient to cover its operating costs.

These conditions raise substantial

doubt about the Company’s ability to continue as a going concern.

The consolidated financial statements do not include any adjustments

that might result from the outcome of this uncertainty.

of the Company to continue as a going concern is dependent upon its ability to successfully accomplish its business plan and eventually

attain profitable operations.

During the next

year, the Company's foreseeable cash requirements will relate to continual development of the operations of its business, maintaining

from operations, negative working capital and does not have an established source of revenues sufficient to cover its operating costs.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The consolidated financial

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

ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish its business plan and

eventually attain profitable operations.

the next year, the Company's foreseeable cash requirements will relate to continual development of the operations of its business, maintaining

its good standing in the industry and continuing its marketing efforts.

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Historically,

the Company has relied upon funds from its stockholders.

Management may raise additional capital through future public or private offerings

of the Company's stock or through loans from private investors, although there can be no assurance that it will be able to obtain such

The Company's failure to do so could have a material and adverse effect upon its operations and its stockholders.

On May 13, 2022, we entered

into a Company Acquisition Agreement (Purchase Agreement) with US Acquisitions, LLC, a California limited liability company (Seller) concerning

the contemplated sale by Seller and the purchase by us of 51 % of the membership interests Seller held in Whisl, a Texas limited

liability company.

Whisl provides local US termination for Voice through its FCC license of VoIP Service number 832742;

and is in the

process to obtain a C-Lec FCC License over next 12 months.

Whisl is one of the premier Intermediate Voice Providers in the USA.

been a carrier since 2017 with billions of minutes traversing its network and provides its customers with multiple levels of Redundancy,

Diversity, and Disaster Recovery for their applications and ability to make changes to underlying carrier configuration in real time.

Whisl offers a single carrier solution for Voice Global services, and its customers benefit from hundreds of interconnection agreements

that the company has cultivated since its inception.

Pursuant to the Purchase Agreement, the closing of the purchase of the 51 % membership

interests was $ 1,800,000 , which consisted of $ 1,250,000 in cash and $ 550,000 in our restricted common stock to

Seller, which amounts to 1,461,653 shares of common stock.

On June 1, 2022, we entered

into a Purchase Agreement for the purchase of 51 % of the membership interests in Smartbiz, a Florida Corporation which provides

telecommunication services, dedicated to VoIP business for wholesale and retail markets.

The purchase price for the acquisition was $ 1,800,000 ,

which consisted of $ 800,000 in cash and $ 1,000,000 in our common stock to the seller, which amounts to 2,850,330 shares

of common stock.

Smartbiz and Whisl have been included in our consolidated

results of operations since the acquisition dates.

The following table summarizes the fair value

of the consideration paid by the Company:

Fair Value of Consideration:

1,461,653 shares of common stock

Total Purchase Price

the Company has relied upon funds from its stockholders, and loans from third parties.

Management may raise additional capital through

future public or private offerings of the Company's stock or through loans from private investors, although there can be no assurance

that it will be able to obtain such financing.

The Company's failure to do so could have a material and adverse effect upon its operations

and its stockholders.

- ACQUISITIONS

19, 2024 , we entered into a Share Purchase Agreement (“Purchase Agreement”) with Yukon River Holdings, Ltd.

River”), a corporation formed under the laws of the British Virgin Islands (“Seller”) concerning the contemplated sale

by Seller and the purchase by us of 51 % of the ordinary shares Seller holds in QXTEL LIMITED (“QXTEL”), a company incorporated

in England and Wales.

purchase price (the “Purchase Price”) payable to the Seller for the shares is $ 5,000,000 .

Upon the execution of the

Purchase Agreement, we agreed to deposit $ 1,500,000 of the Purchase Price into the trust account of a law firm acting as escrow

agent (the “Escrow Agent”) as a nonrefundable deposit to evidence our good faith intention to purchase the shares, which

was credited against the Purchase Price.

closing, in addition to the $ 1,500,000 with the Escrow Agent that formed part of the Purchase Price, we were required to pay $ 1,500,000 in

cash and $ 2,000,000 to the Seller, either (A) in the form of a promissory note (the “Promissory Note”), or (B)

by the delivery of iQSTEL shares to Seller.

Seller could decide the form of payment between the Promissory Note or the shares of iQSTEL,

and if a Promissory Note was chosen, we agreed to allow Seller the option to exchange the Promissory Note for shares of iQSTEL.

27, 2024, we entered into a second amendment to the Purchase Agreement (the “Amendment”) that required us to issue an amended

and restated promissory note to the Seller.

We had paid down $ 200,000 of the note, so the amended and restated promissory note

was issued in the principal amount of US $ 1,800,000 .

The amended and restated promissory note also changed the payment structure,

from installment payments of $ 200,000 for each of the months of May through November ($1,400,000) with a balloon payment of $ 600,000 ,

to monthly installments of $ 75,000 plus interest during 2024, and $ 212,500 plus interest during the first 6 months

We also revised the Earnout Payment due to the Seller.

The Earnout Payment was redefined at $ 721,035 net income,

to be achieved in Q2, Q3 and Q4 of 2024.

The $ 1,000,000 payment that IQSTEL has to pay upon achievement of the Earnout Payment

will be paid in monthly installments during the first half of 2025.

year ended December 31, 2024, the Company repaid $ 725,000 on the Promissory Note.

The acquisition

was closed on April 1, 2024.

QXTEL has been included in our consolidated results of operations since the acquisition date.

The following

table summarizes the fair value of the consideration paid by the Company:

Fair Value of Consideration:

2,850,330 shares of common stock

Promissory note

Contingent liability

Total Purchase Price

An additional 754,684 shares

of common stock were issued to the seller in December 2022 in accordance with the terms of the purchase agreement.

The following table summarizes the identifiable

assets acquired and liabilities assumed upon acquisition of Smartbiz and Whisl and the calculation of goodwill:

The following

table summarizes the identifiable assets acquired and liabilities assumed upon acquisition of QXTEL and the calculation of goodwill:

Total purchase price

Accounts receivable

Due from related party

Total identifiable assets

2 unchanged sentences

Total liabilities assumed

Intangible assets recognized

Non-controlling interest - 49 %

( 4,248,685 )

Total net assets

Total purchase price

Accounts receivable

Total identifiable assets

Accounts payable

Other current liabilities

Total liabilities assumed

Accumulated deficit

Non-controlling interest

Total accumulated deficit

Unaudited combined proforma results of operations

for the year ended December 31, 2022 as though the Company acquired Smartbiz and Whisl on January 1, 2022, are set forth below:

combined proforma results of operations for the year ended December 31, 2024 and 2023 as though the Company acquired QXTEL on January

1, 2023, are set forth below:

$ 310,903,903

$ 225,999,964

Cost of revenues

Operating expenses

Operating loss

( 4,125,703 )

Other expense

Operating (loss) income

Other (expense) income

( 3,951,942 )

Net (loss) income

$ ( 5,287,235 )

NOTE 5 – PREPAID

AND OTHER CURRENT ASSETS

– PREPAID AND OTHER CURRENT ASSETS

other current assets at December 31, 2024 and 2023 consisted of the following:

5 unchanged sentences

Security deposit

prepaid and other current assets

NOTE 6 – PROPERTY

AND EQUIPMENT

Total prepaid and other current assets

– PROPERTY AND EQUIPMENT

equipment at December 31, 2024 and 2023 consisted of the following:

6 unchanged sentences

expense for the years ended December 31, 2024 and 2023 amounted to $ 138,597 and $ 128,737 , respectively.

NOTE 7 –LOANS

– INTANGIBLE ASSETS

assets at December 31, 2024 and 2023 consisted of the following:

Gross carrying amount

Accumulated amortization

Net carrying amount

New gas regulator intangible

Interconnection agreements

$ ( 360,938 )

(*) Not yet in service

Gross carrying amount

Accumulated amortization

Net carrying amount

gas regulator intangible

(*) Not yet in service

expense for the years ended December 31, 2024 and 2023 amounted to $ 360,938 and $ 0 .

The following

table outlines the estimated future amortization expense as of December 31, 2024:

– ACCRUED AND OTHER CURRENT LIABILITIES

other current liabilities at December 31, 2024 and 2023 consisted of the following

Accrued liabilities

Cost provision

Accrued interest

Salary payable - management

Salary payable and employee benefit

Other current liabilities

Total accrued and other current liabilities

- LOANS PAYABLE

Loans payable

at December 31, 2024 and 2023 consisted of the following:

5 unchanged sentences

Promissory note payable

Note was issued December 6, 2023 and due on October 15, 2024

Note was issued June 11, 2024 and due on June 11, 2025

Promissory note payable - acquisition of QXTEL

Note was issued April 1, 2024 and due on June 30, 2025

Promissory note payable

Note was issued July 16, 2024 and due on July 16, 2025

Promissory note payable

Note was issued July 31, 2024 and due on July 31, 2025

Promissory note payable

Note was issued September 23, 2024 and due on September 23, 2025

Promissory note payable

Note was issued October 4, 2024 and due on September 23, 2025

Unamortized debt discount

1 unchanged sentence

Current portion of loans payable

( 2,455,641 )

Long-term loans payable

5 unchanged sentences

Note is due on demand

Minority Shareholder of QXTEL

Note is due on October 1, 2025

Current portion of loans payable - related parties

Long-term loans payable - related parties

During the years

ended December 31, 2023 and 2022, the Company borrowed from third parties totaling $ 421,760 and $ 0 , which includes original issue

discount and financing costs of $ 46,760 and $ 0 and repaid the principal amount of $ 18,559 and $ 232,018 , respectively.

During the years

ended December 31, 2023 and 2022, the Company recorded interest expense of $ 32,231 and $ 22,234 and recognized amortization of discount,

included in interest expense, of $ 14,426 and $ 7,407 , respectively.

the years ended December 31, 2024 and 2023, the Company borrowed from third parties totaling $ 5,041,532 and $ 421,760 , which includes

original issue discount and financing costs of $ 546,680 and $ 46,760 and repaid the principal amount of $ 2,571,139 and

$ 18,559 , respectively.

the years ended December 31, 2024 and 2023, the Company recorded interest expense of $ 293,671 and $ 32,231 and recognized amortization

of discount, included in interest expense, of $ 300,303 and $ 14,426 , respectively.

- CONVERTIBLE LOANS

the year ended December 31, 2023, the Company borrowed from a third party totaling $ 284,760 , which includes original issue discount

and financing costs of $ 34,760 .

The note is due on June 1, 2024 and a one-time interest charge of 12 % shall be applied.

unpaid interest and outstanding principal shall be paid in 10 payments each in the amount of $31,893 beginning on July 16, 2023 .

note is convertible at the option of the holders at any time following an event of default, and the conversion price is 75% multiplied

by the lowest trading price of Company’s common stock during the 10 trading days prior to the conversion date .

loans at December 31, 2024 and 2023 consisted of the following:

Issued in fiscal year 2023

Issued in fiscal year 2024

Total convertible notes payable

Unamortized debt discount

Total convertible notes

current portion of convertible notes

Long-term convertible notes

the years ended December 31, 2024 and 2023, the Company recorded interest expense of $ 769,027 and $ 23,919 and recognized amortization

of discount, included in interest expense, of $ 796,422 and $ 24,332 , respectively.

NOTE 9 – WARRANTS

On April 5, 2022, we entered

into a Common Stock Purchase Option Agreement with Apollo Management Group, Inc (Holder) to subscribe for and purchase from the Company, 4,800,000 shares

of Common Stock with an exercise price per share of $ 2.00 ;

and an initial exercisable date on September 30, 2022 .

price of this option was $ 500,000 .

The Company determined that the warrants had a fixed monetary value with a variable number of

shares at inception and categorized the warrants as a liability in the accompanying consolidated financial statements.

The Holder and the Company agreed that the Holder

had the right and the obligation to exercise, on a cashless basis, $1,000,000 of the Options not later than October 15, 2022.

the Holder shall undertake to exercise not less than (i) $ 400,000 of the Options on a “cash basis” not later than

the later of (y) November 14, 2022 or (z) the date on which there is an effective registration statement permitting the issuance of the

Option Shares to or resale of the Option Shares by the Holder and (ii) an additional $ 400,000 of the Options on a “cash

basis” not later than the latest of (x) thirty (30) days following the exercise of the Option under subsection (i), above, (y) December

14, 2022, or (z) the date on which there is an effective registration statement permitting the issuance of the Option Shares to or resale

of the Option Shares by the Holder .

From and after the occurrence of the three above-referenced exercises, each additional exercise of

Options hereunder shall be in an amount not less than $200,000 and exercised only on a cash basis.

The Holder’s obligation to exercise each specified

portion of this option on the specific dates above is subject to the volume-weighted average price (“VWAP”, market value),

being not less than $0.20 per share on the relevant option exercise date.

Adjusted option shares at VWAP of $0.20 shall be 48,000,000

activity regarding warrants issued as follows:

in fiscal year 2023

the year ended December 31, 2023, the Company borrowed $ 284,760 and $ 256,760 from a third party totaling $541,520,

which includes original issue discount and financing costs of $ 66,520 .

The notes are due on June 1, 2024 and October

15, 2024 , and a one-time interest charge of 12% shall be applied.

Accrued, unpaid interest and outstanding principal

shall be paid in 10 payments each in the amount of $ 31,893 and $ 28,757 beginning on July 16, 2023 and January 15,

2024, respectively .

The notes are convertible at the option of the holders at any time following an event of default, and the conversion

price is 75% multiplied by the lowest trading price of Company’s common stock during the 10 trading days prior to the conversion

in fiscal year 2024

January 24, 2024, we entered into a securities purchase agreement (the “SPA”) with M2B Funding Corp., a Florida corporation,

for it to purchase up to the principal amount of $ 3,888,889 in secured convertible promissory notes (the “Notes”)

for an aggregate purchase price of $ 3,500,000 (the “Purchase Price”), which Notes are convertible into shares (“Conversion

Shares”) of our common stock with an initial conversion price of $ 0.11 per share.

Each noteholder shall receive

shares of common stock (“Kicker Shares”) in an amount equal to ten percent of the principal amount of any Note issued divided

The Notes are secured by all of our assets under a Security Agreement signed with the SPA.

initial tranche was executed in January 2024 for $ 2,222,222 in face value of Notes and 2,020,200 Kicker Shares, with

an original issue discount of $ 222,222 ;

second and third tranches were executed in March 2024 for $ 1,111,111 and $ 555,556 ,

respectively, in face value of Notes and 1,010,101 and 505,051 Kicker Shares, with an original issue discount of $ 111,111 and $ 55,556 ,

respectively.

Each one year note bears interest at 18 % per annum.

October 2024, we entered into a Memorandum of Understanding (the “Agreement”) with M2B Funding Corp.

to extend the maturity

date on three promissory notes in exchange for stock consideration.

Pursuant to the Agreement, the following promissory notes were extended

by 12 months from their original date of maturity:

Originally due January 1, 2025, with an outstanding amount of $1,888,889, extended to January 1, 2026.

Originally due March 12, 2025, with an outstanding amount of $1,111,111, extended to March 12, 2026.

Originally due March 25, 2025, with an outstanding amount of $555,556, extended to March 25, 2026.

consideration for this extension, the Company issued 646,467 restricted common shares.

As a result of the extension, the Company recognized

the loss on debt extinguishment of $297,878 as debt extinguishment and debt discount of $61,818 as debt modification.

Additionally,

during the year ended December 31, 2024, the Company borrowed amounts from a third party totaling $2,413,707, which includes original

issue discount and financing costs of $248,707.

March 7, 2024

January 15, 2025

10 payments each in the amount of $ 16,453 beginning

on April 15, 2024

March 7, 2024

January 15, 2025

5 payments, one payment of $ 100,947 and four

payments of $ 25,237 , beginning in September 2024

July 10, 2024

April 30, 2025

9 payments each in the amount of $ 22,724 beginning

on August 30, 202 4

September 16, 2024

July 15, 2025

5 payments, one payment of $ 86,617 and four

payments of $ 21,654 , beginning in March 2025

October 15, 2024

July 15, 2025

9 payments each in the amount of $ 22,724 beginning

on November 30, 2024

December 6, 2024

Outstanding balance shall be paid on June 4, 2025

notes are convertible at the option of the holders at any time following an event of default, and the conversion price is 75% multiplied

by the lowest trading price of Company’s common stock during the 10 trading days prior to the conversion date.

the year ended December 31, 2024, one note holder converted notes with principal amounts of $ 666,666 and conversion fee

of $ 5,000 into 6,106,061 shares of common stock.

February 12, 2024, we issued a Common Stock Purchase Option (the “Option”) to ADI Funding LLC (“ADI Funding”)

for $ 100,000 that expired on December 31, 2024, for the right to acquire up to 10,000,000 shares of common stock.

exercise price per share of the common stock under the Option was (i) 70% of the VWAP of the common stock during the then 10 Trading

Days immediately preceding, but not including the date of exercise if the VWAP is below $2.00 or (ii) seventy five percent (75%) of the

VWAP of the common stock during the then 10 Trading Days immediately preceding, but not including the date of exercise if the VWAP is

equal or above $2.00 .

Funding had the right and the obligation to exercise, on a “cash basis”, not less than (i) 2,000,000 of the shares of common

stock underlying the option no later than the later of March 31, 2024 or the date on which there is an effective registration statement

permitting the resale of the shares by ADI Funding.

From and after the occurrence of the above-referenced exercise, each additional exercise

of the Option could be in an amount not less than 1,000,000 shares, which shall occur every thirty (30) days and shall be exercised only

on a cash basis.

ADI Funding’s obligation to exercise each specified portion of the Option was subject to the exercise price being

not less than $0.11

the Company issues securities less than the exercise price of the option, ADI Funding had a right to also use that lesser price in the

exercise of its Option.

The Option also contained rights to any Company distributions and consideration in fundamental transactions.

Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s

specific terms and applicable authoritative guidance in FASB ASC 480, Distinguishing Liabilities from Equity (“ASC

480”) and ASC 815, Derivatives and Hedging (“ASC 815”).

The assessment considers whether the warrants

are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants

meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s

own common shares and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside

of the Company’s control, among other conditions for equity classification.

This assessment, which requires the use of professional

judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

Company determined that the warrants had net cash settlement and categorized the warrants as a liability in the accompanying consolidated

financial statements.

summary of activity regarding warrants issued as follows:

Warrants Outstanding

Weighted Average

Weighted Average Remaining

life (in years)

Exercise Price

Contractual life (in years)

Outstanding, December 31, 2022

2 unchanged sentences

Forfeited/canceled

Outstanding, December 31, 2022

Increase in number of warrants by VWAP

( 18,080,921 )

Outstanding, December 31, 2023

( 10,000,000 )

Forfeited/canceled

Outstanding, December 31, 2024

NOTE 10 – DERIVATIVE

intrinsic value of the warrants as of December 31, 2024 is $ 0 .

– DERIVATIVE LIABILITIES

Assumptions Used in Accounting for Derivative Liabilities

ASC 815 requires

we assess the fair market value of derivative liabilities at the end of each reporting period and recognize any change in the fair market

value as other income or expense.

determined our derivative liabilities to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the

fair value as of December 31, 2023.

815 requires we assess the fair market value of derivative liabilities at the end of each reporting period and recognize any change in

the fair market value as other income or expense.

Company determined our derivative liabilities to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate

the fair value as of December 31, 2024.

The Black-Scholes model requires six basic data inputs:

the exercise or strike price, time to expiration,

the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the dividend rate.

the exercise or strike price, time to

expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the future, and the

dividend rate.

Changes to these inputs could produce a significantly higher or lower fair value measurement.

For the years

ended December 31, 2023 and 2022, the estimated fair values of the liabilities measured on a recurring basis are as follows:

the years ended December 31, 2024 and 2023, the estimated fair values of the liabilities measured on a recurring basis are as follows:

Expected term

0.00 - 0.70 years

0.75 - 1.49 years

Expected average volatility

1 unchanged sentence

Risk-free interest rate

4.67 % - 5.55 %

0.06 % - 4.73 %

The following

2 unchanged sentences

Balance - December 31,

Addition of new derivatives recognized as cash received

Addition of new derivatives recognized as loss on derivatives

Settled on issuance of common stock

( 1,792,582 )

Change in fair value of the warrants

Settled on issuance of

Change in fair value of

Balance - December 31,

Settled on issuance of common stock

Change in fair value of the warrants

Addition of new derivatives

recognized as cash received

Exercise on issuance of

( 1,493,046 )

Change in fair value of

Balance - December 31,

4 unchanged sentences

Revaluation of derivative liabilities

Change in fair value of derivative liabilities

NOTE 11 – STOCKHOLDERS’

The Company’s

authorized capital consists of 300,000,000 shares of common stock with a par value of $ 0.001 per share.

the year ended December 31, 2023, the Company issued 10,534,119 shares of common stock, valued at fair market value on issuance as

Change in fair value of derivative liability

$ ( 381,848 )

13 – STOCKHOLDERS’ EQUITY

Company’s authorized capital consists of 300,000,000 shares of common stock with a par value of $ 0.001 per

the year ended December 31, 2024, the Company issued 30,847,055 shares of common stock and 285,000 shares payable, valued at fair

market value on issuance as follows:

• 600,000 shares for compensation to our directors valued at $ 141,025 ;

• 3,007,173 shares for settlement of debt valued at $ 483,670 ;

• 3,535,354 shares in conjunction with convertible notes valued at $ 597,777 ;

• 10,000,000 shares for exercise of warrants for $ 1,100,000 ;

During the year

ended December 31, 2022, the Company issued 14,118,153 shares of common stock, valued at fair market value on issuance as follows:

shares for conversion of debt of $ 671,666

shares issued for cash of $ 100,000

shares for acquisitions of Whisl and Smartbiz valued at $ 1,550,000

shares for asset acquisition valued at $ 357,500

shares for the extension of debt valued at $ 116,364

shares for conversion of Series B Preferred Stock

shares of stock payable for service valued at $ 82,194 recorded as additional paid in capital as of December 31, 2024.

Shares were issued

on January 16, 2025.

year ended December 31, 2023, the Company issued 10,534,119 shares of common stock, valued at fair market value on issuance

• 240,000 shares for compensation to our directors valued at $ 42,890 ;

shares for settlement of debt valued at $ 80,674

• 10,294,119 shares for exercise of warrants for $ 1,400,000 .

As of December

31, 2023 and 2022, 172,129,630 and 161,595,511 shares of common stock were issued and outstanding, respectively.

Preferred Stock

3, 2020, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock

entitled Series A Preferred Stock, consisting of up 10,000 shares, par value $ 0.001 .

Under the Certificate of Designation,

holders of Series A Preferred Stock will participate on an equal basis per-share with holders of our common stock in any distribution

upon winding up, dissolution, or liquidation.

Holders of Series A Preferred Stock are entitled to vote together with the holders of our

common stock on all matters submitted to stockholders at a rate of 51% of the total vote of stockholders.

The rights of

the holders of Series A Preferred Stock are defined in the relevant Certificate of Designation filed with the Nevada Secretary of State

on November 3, 2020

As of December

31, 2023 and 2022, 10,000 shares of Series A Preferred Stock were issued and outstanding.

Preferred Stock

of December 31, 2024 and 2023, 202,976,685 and 172,129,630 shares of common stock were issued and outstanding, respectively.

A Preferred Stock

November 3, 2020, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred

stock entitled Series A Preferred Stock, consisting of up 10,000 shares, par value $ 0.001 .

Under the Certificate of Designation, holders

of Series A Preferred Stock will participate on an equal basis per-share with holders of our common stock in any distribution upon winding

up, dissolution, or liquidatio n.

Holders of Series A Preferred Stock are entitled to vote together with the holders of our common stock

on all matters submitted to stockholders at a rate of 51% of the total vote of stockholders.

rights of the holders of Series A Preferred Stock are defined in the relevant Certificate of Designation filed with the Nevada Secretary

of State on November 3, 2020

of December 31, 2024 and 2023, 10,000 shares of Series A Preferred Stock were issued and outstanding.

B Preferred Stock

11, 2020, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock

entitled Series B Preferred Stock, consisting of up 200,000 shares, par value $ 0.001 .

Under the Certificate of Designation,

holders of Series B Preferred Stock will receive a liquidation preference of $81 per share in any distribution upon winding up, dissolution,

Under the Certificate of Designation, holders

of Series B Preferred Stock will receive a liquidation preference of $81 per share in any distribution upon winding up, dissolution,

or liquidation of the Company before junior security holders, as provided in the designation .

4 unchanged sentences

Holders of Series B Preferred Stock do not have voting rights but may convert into common stock after

twelve months from the issuance date, at a conversion rate of one thousand (1,000) shares of Common Stock for every one (1) share of Series

B Preferred Stock.

Upon conversion, the shares are subject to a one-year restriction on sales into the market of no more than 5% previous

month’s stock liquidity.

In August 2023,

the Company declared and issued 10,080 shares Series B stock to our management as dividends, valued at $ 816,480 .

As of December

31, 2023 and 2022, 31,080 and 21,000 shares of Series B Preferred Stock were issued and outstanding, respectively.

Preferred Stock

On January 7,

2021, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock entitled

Series C Preferred Stock, consisting of up 200,000 shares, par value $ 0.001 .

twelve months from the issuance date, at a conversion rate of one thousand (1,000) shares of Common Stock for every one (1) share of

Series B Preferred Stock.

Upon conversion, the shares are subject to a one-year restriction on sales into the market of no more than

5% previous month’s stock liquidity.

August 2023, the Company declared and issued 10,080 shares Series B stock to our management as dividends, valued at $ 816,480 .

November 2024, the Company declared and issued 8,959 shares Series B stock to our management as dividends, valued at $627,710.

December 2024, a member of Company management converted 4,502 shares of Series B Preferred Stock into 4,502,000 shares of common

of December 31, 2024 and 2023, 35,537 and 31,080 shares of Series B Preferred Stock were issued and outstanding, respectively.

C Preferred Stock

January 7, 2021, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred

stock entitled Series C Preferred Stock, consisting of up 200,000 shares, par value $ 0.001 .

Under the Certificate of Designation, holders

4 unchanged sentences

funds legally available for that purpose .

Holders of Series C Preferred Stock do not have voting rights but may convert into common stock

H olders of Series C Preferred Stock do not have voting rights but may convert into common stock

after twenty four months from the issuance date, at a conversion rate of one thousand (1,000) shares of Common Stock for every one (1)

2 unchanged sentences

than 5% previous month’s stock liquidity .

The rights of

the holders of Series C Preferred Stock are defined in the relevant Certificate of Designation filed with the Nevada Secretary of State

on January 7, 2021.

As of December

31, 2023 and 2022, no Series C Preferred Stock was issued or outstanding.

Preferred Stock

On November 3, 2023, pursuant to Article III of our

Articles of Incorporation, our Board of Directors voted to designate a class of preferred stock entitled Series D Preferred Stock, consisting

of up 75,000 shares, par value $ 0.001 .

Under the Certificate of Designation, in the event of any dissolution, liquidation or winding up

of the Corporation, the Holders of Series D Preferred Stock shall be entitled to participate in any distribution out of the assets of

the Corporation before the holders of the Common Stock, Series A Preferred Stock and Series C Preferred Stock, but shall be considered

on parity to the liquidation rights of the Series B Preferred Stockholders.

The holders of shares of Series D Preferred Stock have no

dividend rights except as may be declared by the Board in its sole and absolute discretion, out of funds legally available for that purpose .

Holders of Series D Preferred Stock do not have voting rights but may convert into common stock at a conversion rate of one thousand (1,000)

shares of Common Stock for every one (1) share of Series D Preferred Stock.

The rights of

the holders of Series D Preferred Stock are defined in the relevant Certificate of Designation filed with the Nevada Secretary of State

on November 3, 2023.

rights of the holders of Series C Preferred Stock are defined in the relevant Certificate of Designation filed with the Nevada Secretary

of State on January 7, 2021.

of December 31, 2024 and 2023, no Series C Preferred Stock was issued or outstanding.

D Preferred Stock

November 3, 2023, pursuant to Article III of our Articles of Incorporation, our Board of Directors voted to designate a class of preferred

stock entitled Series D Preferred Stock, consisting of up 75,000 shares, par value $ 0.001 .

Under the Certificate of Designation,

in the event of any dissolution, liquidation or winding up of the Corporation, the Holders of Series D Preferred Stock shall be entitled

to participate in any distribution out of the assets of the Corporation before the holders of the Common Stock, Series A Preferred Stock

and Series C Preferred Stock, but shall be considered on parity to the liquidation rights of the Series B Preferred Stockholders .

of shares of Series D Preferred Stock have no dividend rights except as may be declared by the Board in its sole and absolute discretion,

out of funds legally available for that purpose .

Holders of Series D Preferred Stock do not have voting rights but may convert into

common stock at a conversion rate of one thousand (1,000) shares of Common Stock for every one (1) share of Series D Preferred Stock .

rights of the holders of Series D Preferred Stock are defined in the relevant Certificate of Designation filed with the Nevada Secretary

of State on November 3, 2023.

As of December

31, 2024 and 2023, no Series D Preferred Stock was issued or outstanding.

NOTE 12 – PROVISION

FOR INCOME TAXES

provides for income taxes under ASC 740, “ Income Taxes.” Under the asset and liability method of ASC 740, deferred

tax assets and liabilities are recorded based on the differences between the financial statement and tax basis of assets and liabilities

and the tax rates in effect when these differences are expected to reverse.

A valuation allowance is provided for certain deferred tax

assets if it is more likely than not that the Company will not realize tax assets through future operations.

The components

of the Company’s deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income tax amount recorded

as of December 31, 2023 and 2022, are as follows:

– PROVISION FOR INCOME TAXES

Company provides for income taxes under ASC 740, “ Income Taxes.” Under the asset and liability method of ASC

740, deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax basis of assets

and liabilities and the tax rates in effect when these differences are expected to reverse.

A valuation allowance is provided for certain

deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

following table presents a reconciliation of the income taxes presented in the Statement of Operations for the years ended December 31,

2024 and 2023 :

Year Ended December 31

Income tax expense

components of the Company’s deferred tax asset and reconciliation of income taxes computed at the statutory rate to the income

tax amount recorded as of December 31, 2024 and 2023, are as follows:

Net Operating loss carryforward

6 unchanged sentences

Net deferred tax asset

As of December

31, 2023, the Company has approximately $ 13,500,000 of net operating losses (“NOL”) generated to December 31, 2023

carried forward to offset taxable income in future years which expire commencing in fiscal 2023.

of December 31, 2024, the Company has approximately $ 15,400,000 of net operating losses (“NOL”) generated to December

31, 2024 carried forward to offset taxable income in future years which began to expire in 2023.

NOLs generated in the United States

9 unchanged sentences

Based on the assessment, management has established a full

valuation allowance against all of the deferred tax assets relating to NOLs for every period because it is more likely than not that all

of the deferred tax assets will not be realized other than those recorded at SwissLink, because the Company anticipates utilizing the

NOLs prior to their expiration.

valuation allowance against all of the deferred tax assets relating to NOLs for every period because it is more likely than not that

all of the deferred tax assets will not be realized other than those recorded at SwissLink, because the Company anticipates utilizing

the NOLs prior to their expiration.

of the NOL carry forwards may be subject to an annual limitation due to ownership change limitations that may have occurred or that could

3 unchanged sentences

In general, an “ownership change” as defined by Section 382 of the Code results from a transaction or series of transactions

over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain

stockholders.

over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by

certain stockholders.

for the years ended 2018 through 2024 are subject to review by the tax authorities.

1 unchanged sentence

related party

During the years

ended December 31, 2023 and 2022, the Company loaned $ 192,154 and $ 1,000 to a related party and collected $ 79,649 and $ 700 ,

respectively.

As of December

31, 2023 and 2022, the Company had amounts due from related parties of $ 340,515

and $ 326,324 ,

respectively.

The loans are unsecured, non-interest bearing and due on demand.

Due to related

As of December

31, 2023 and 2022, the Company had amounts due to related parties of $ 26,613 .

The amounts are unsecured, non-interest bearing and

due on demand.

During the years

ended December 31, 2023 and 2022, the Company recorded management salaries of $ 516,000 and $ 576,000 , respectively, and stock-based

compensation bonuses of $ 42,890 and $ 107,600 , respectively.

As of December

31, 2023 and 2022, the Company recorded and accrued management salaries of $ 100,128 and $ 79,628 , respectively.

NOTE 14 – COMMITMENTS

AND CONTINGENCIES

Long-term Contracts

has not entered into any long-term leases, contracts or commitments.

The Company leases facilities which the term is 12 months .

the years ended December 31, 2023 and 2022, the Company incurred rent expense of $ 5,954 and $ 73,865 , respectively.

31, 2023 and 2022, the Company operates in one industry segment, telecommunication services, and two geographic segments, USA and Switzerland,

where current assets and equipment are located .

The following

table shows operating activities information by geographic segment for the years ended December 31, 2023 and 2022:

the years ended December 31, 2024 and 2023, the Company loaned $ 89,832 and $ 192,154 to a related party and collected $ 33,602

and $ 79,649 , respectively.

of December 31, 2024 and 2023, the Company had amounts due from related parties of $ 630,715 and $ 340,515 , respectively.

are unsecured, non-interest bearing and due on demand.

to related parties

of December 31, 2024 and 2023, the Company had amounts due to related parties of $ 26,613 .

The amounts are unsecured, non-interest

bearing and due on demand.

the years ended December 31, 2024 and 2023, the Company recorded management salaries of $ 846,000 and $ 516,000 , respectively, and

stock-based compensation bonuses of $ 223,219 and $ 42,890 , respectively.

of December 31, 2024 and 2023, the Company recorded and accrued management salaries of $ 420,447 and $ 100,128 , respectively.

– COMMITMENTS AND CONTINGENCIES

and Long-term Contracts

Company has not entered into any long-term leases, contracts or commitments.

The Company leases facilities which the term is 12

For the years ended December 31, 2024 and 2023, the Company incurred rent expense of $ 28,539 and $ 5,954 , respectively.

The Company operates in one industry segment, telecommunication services, and three geographic segments, USA, UK and Switzerland, where

current assets and equipment are located.

The Company's chief operating decision maker ("CODM") is its chief financial officer,

who reviews the operating results for the Company as a whole to make decisions about allocating resources and assessing financial performance.

The CODM uses operating activities and net assets to assess financial performance and allocate resources.

These financial metrics are

used by the CODM to make key operating decisions, such as the determination of the rate at which the Company seeks to grow, the allocation

of budget between cost of sales and operating expenses and the management of assets.

following table shows operating activities information by geographic segment for the years ended December 31, 2024 and 2023:

17 - SEGMENT - Geographic Segment (Details)

December 31, 2024

NOTE 15 - SEGMENT - Schedule of Operating Activities

by Geographic Segment

$ 197,007,636

4 unchanged sentences

Operating expenses

General and administration

Salaries, Wages and Benefits

Professional Fees

Legal and Regulatory

Travel & Events

Bad Debt Expense

Depreciation and Amortization

Bank Services and Fees

Office, Facility and Other

Sales Commissions

Stock-based compensation

Total Operating Expenses

Operating income (loss)

( 1,275,003 )

Other income (expense)

1 unchanged sentence

( 3,951,942 )

Income tax expense

Net income (loss)

$ ( 5,236,173 )

$ ( 320,636 )

$ ( 5,180,036 )

December 31, 2023

$ 144,466,050

$ ( 5,494,437 )

$ 144,502,351

Cost of revenue

( 5,494,437 )

Operating expenses

General and administration

Operating loss

Salaries, Wages and Benefits

Professional Fees

Legal and Regulatory

Travel & Events

Bad Debt Expense

Depreciation and Amortization

Bank Services and Fees

Office, Facility and Other

Sales Commissions

Stock-based compensation

Total Operating Expenses

Operating income (loss)

Other income (expense)

Net income (loss)

The following

table shows asset information by geographic segment as of December 31, 2023 and 2022:

$ ( 218,874 )

$ ( 219,436 )

following table shows asset information by geographic segment as of December 31, 2024 and 2023:

December 31, 2024

8 unchanged sentences

Current assets

$ ( 693,424 )

Non-current assets

$ ( 6,184,562 )

Current liabilities

$ ( 693,424 )

Non-current liabilities

18 – SUBSEQUENT EVENTS .

Subsequent to

December 31, 2023 and through the date that these financials were made available, the Company had the following subsequent events:

On January 19, 2024, we entered

into a Share Purchase Agreement (“Purchase Agreement”) with Yukon River Holdings, Ltd.

(“Yukon River”), a corporation

formed under the laws of the British Virgin Islands (“Seller”) concerning the contemplated sale by Seller and the purchase

by us of 51% of the ordinary shares Seller holds in QXTEL LIMITED, a company incorporated in England and Wales.

The purchase price (the “Purchase

Price”) payable to the Seller for the shares is $5,000,000.

Upon the execution of the Purchase Agreement, we agreed to deposit $1,500,000

of the Purchase Price into the trust account of a law firm acting as escrow agent (the “Escrow Agent”) as a nonrefundable

deposit to evidence our good faith intention to purchase the shares.

If the Purchase Agreement does not close before April 30, 2024, the

deposit is non-refundable.

If the Purchase Agreement closes, the deposit will be credited against the Purchase Price.

At closing, in addition to

the $1,500,000 with the Escrow Agent that will form part of the Purchase Price, we are required to pay $1,500,000 in cash and $2,000,000

to the Seller, either (A) in the form of a promissory note (the “Promissory Note”), or (B) by the delivery of iQSTEL shares

Seller may decide the form of payment between the Promissory Note or the share of iQSTEL, and if a Promissory Note is chosen,

we have agreed to allow Seller the option to exchange the Promissory Note for shares of iQSTEL.

On January 24, 2024, we entered

into a securities purchase agreement (the “SPA”) with M2B Funding Corp., a Florida corporation, for it to purchase up to the

principal amount of $3,888,888.89 in secured convertible promissory notes (the “Notes”) for an aggregate purchase price of

$3,500,000.00 (the “Purchase Price”), which Notes are convertible into shares (“Conversion Shares”) of our common

stock with an initial conversion price of $0.11 per share.

Each noteholder shall receive shares of common stock (“Kicker Shares”)

in an amount equal to ten percent of the principal amount of any Note issued divided by $0.11.

The Notes are secured by all of our assets

under a Security Agreement signed with the SPA.

The initial tranche was executed

in January 2024 for $2,222,222.22 in face value of Notes and Kicker Shares, with an original issue discount of $222,222.22, a second and

a third tranches were executed in March 2024 for $1,111,111.11 and $555,555.56 respectively in face value of Notes and Kicker Shares,

with an original issue discount of US $111,111.11 and $55,555.56 respectively.

Each one-year note bears interest at 18% per annum.

Share issuance

shares of common stock were issued valued at $0.10.

shares of common stock were issued valued at $0.11.

Changes In and Disagreements

with Accountants on Accounting and Financial Disclosure

There were no changes or disagreements with our accountants on accounting

and financial disclosure.

to December 31, 2024 and through the date that these financials were made available, the Company had the following subsequent events:

January 14, 2025, the Company issued a Common Stock Purchase Option (the “Option”) to ADI Funding LLC (“ADI Funding”)

under a Stock Purchase Agreement for $100,000 that expires on July 14, 2025, for the right to acquire up to 15,000,000 shares of common

The exercise price per share of the common stock under the Option shall be 70% of the VWAP of the common stock during the then

10 Trading Days immediately preceding but not including the date of exercise.

The obligation to exercise each specified portion of the

Option is subject to the exercise price, being not less than $0.11 per share on the relevant Option exercise date.

March 10, 2025, the Company signed a non-binding memorandum of understanding (“MOU”) with Accredited Solutions, Inc.

to set forth the preliminary terms and mutual understanding between the parties regarding the Company’s potential sale of its 75%

equity interest in ItsBchain, LLC (the “Subsidiary”) to ASII, subject to the negotiation and execution of a definitive Purchase

The parties have agreed to execute the Purchase Agreement no later than June 1, 2025.

the MOU, in exchange for the 75% interest in the Subsidiary, ASII proposes paying $1,000,000 to the Company as follows:

$500,000 in restricted preferred shares of ASII, the terms and features of which will be available prior to execution of the Purchase

Agreement, but should contain preferential treatment on the stated value in any liquidation of ASII and a conversion price of the lowest

stock price with a 10 day look back at conversion (but with a conversion limitation of 4.99%, but no greater than 9.99%), ensuring IQSTEL’s

value is preserved regardless of fluctuations in ASII’s common stock price.

• $500,000 in restricted common shares of ASII, which are expected to be registered by ASII in a resale offering that is filed on Form

S-1 with the SEC within an agreed time from the close of the Purchase Agreement.

some time in the future, the Company plans to distribute the ASII common shares as dividends to its shareholders.

under the MOU, the Company will retain a 1% lifetime royalty on the Subsidiary’s total sales.

The Company acknowledges a remaining

investment commitment of $65,000 related to the Subsidiary.

This amount will be paid in monthly installments of $2,500 directly to the

March 19, 2025, iQSTEL Inc.

(the “Company”) signed a non-binding memorandum of understanding (“MOU”) with Craig

Span (the “Seller”) to set forth the preliminary terms and mutual understanding between the parties regarding the Company’s

potential purchase a 51% equity interest in GlobeTopper, LLC, a Delaware limited liability company (the “GlobeTopper”) held

by the Seller, subject to the negotiation and execution of a definitive Purchase Agreement.

The parties have agreed to execute the Purchase

Agreement no later than July 1, 2025, or sooner.

the MOU, in exchange for the 51% interest in the GlobeTopper, the Company proposes paying $700,000 to the Seller with $200,000 in cash

over a period set forth in a schedule extending to September 1, 2025, and $500,000 in common stock of the Company with a share price

calculated at a 20% discount to the Volume Weighted Average Price (VWAP) over the five days preceding execution of a definitive Purchase

under the MOU, the Company will pay performance bonuses in 2025 and 2026 based on EBITDA growth of GlobeTopper in shares of common stock

of the Company using the same discounted VWAP formula above.

support GlobeTopper’s growth, the MOU provides that the Company will provide up to $1,200,000 in structured financing across 24

months after execution, disbursed in monthly installments of $50,000, contingent upon meeting quarterly financial targets.

stability and operational continuity, the Seller will continue to serve as CEO to GlobeTopper, and 2 of the 3 board members will be selected

by the Company.

Changes In and Disagreements with Accountants on Accounting and Financial Disclosure

no changes or disagreements with our accountants on accounting and financial disclosure.

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 8. Financial Statements and Supplementary Data