What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2024-12-20 compared with 2023-12-14 · 245 added, 269 removed, 220 unchanged (70% of the section changed)

22 unchanged sentences

and assumptions, as mentioned under the “Risk Factors” section in this Form 10-K.

We believe that these forward-looking statements

are based on reasonable assumptions.

Still, you must be aware that many factors, including those mentioned under the “Risk Factors”

section in this Form 10-K, could affect our financial results or operations and cause actual results to differ from those stated in the

forward-looking statements.

These statements were made as of the date of this Form 10-K, and we are not obligated to update or revise

any forward-looking statements made here to reflect any change in our expectations or any change in events, conditions, or circumstances

on which these statements are based.

All written or oral forward-looking statements made by us or on our behalf are qualified by the

cautionary statements mentioned in this Form 10-K.

We believe that these forward- looking

statements are based on reasonable assumptions.

Still, you must be aware that many factors, including those mentioned under the “Risk

Factors” section in this Form 10-K, could affect our financial results or operations and cause actual results to differ from those

stated in the forward-looking statements.

These statements were made as of the date of this Form 10-K, and we are not obligated to update

or revise any forward-looking statements made here to reflect any change in our expectations or any change in events, conditions, or

circumstances on which these statements are based.

All written or oral forward-looking statements made by us or on our behalf are qualified

by the cautionary statements mentioned in this Form 10-K.

this section, we provide an analysis of the Company’s financial condition, cash flows, and results of operations from management’s

4 unchanged sentences

clients with an industry-leading experience through our trusted digital solutions that are simple and fast.

2022 and 2023, the Bank of Canada raised the prime rate several times to curb inflationary pressures.

Consequently, the mortgage interest

rates increased significantly, leading to a considerable shrinkage in the mortgage origination market from 2022 to 2023.

mortgage interest rates, alongside the economic uncertainty, has resulted in a reduced demand for mortgage originations.

2022 and 2023, the Bank of Canada raised the prime rate multiple times to address inflationary pressures, which significantly increased

mortgage interest rates.

However, beginning in mid-2024, the Bank of Canada reduced the policy rate by 1.25%, aiming to stabilize the

economy and improve affordability.

Despite this, the elevated mortgage rates and ongoing economic uncertainty continued to suppress demand

for mortgage originations in 2024.

While the market shows early signs of recovery due to improved consumer confidence, the overall mortgage

origination market remained contracted compared to pre-2022 levels.

of the Year Ended August 31, 2024.

the period under review, we generated $ 1.399 billion in residential mortgage loans compared to $1.790 billion in the previous financial

year, which ended on August 31, 2022.

This amount represents a decrease of $386.00 million or 21.63% compared to the same period that

ended on August 31, 2022.

Our Net Loss stood at $2.874 million, a lower Net Loss compared to the $3,015 million recorded in the same

period on August 31, 2022.

We also generated loss $1.239 million of Adjusted EBITDA, which represents a decrease of $ 0.376 million,

or 23.26%, compared to the $1.615 million generated in the same period on August 31, 2022.

For more information on Adjusted EBITDA, please

refer to the “Non-GAAP Financial Measures” section.

Financial Measures

provide investors with additional information in addition to our GAAP results.

We do this by disclosing our non-GAAP financial measures:

Adjusted Revenue, adjusted net (Loss) income, adjusted diluted (Loss) earnings per share, and adjusted EBITDA.

These measures, which

GAAP does not calculate, are believed to be useful by management in providing investors with useful information regarding the performance

and value of our business.

Our non-GAAP financial measures serve as performance indicators unaffected by fluctuations in certain costs

or other items.

While other companies may define these measures differently, they allow for better comparisons of general operating performance

from period to period.

It is important to note that our non-GAAP financial measures should not be viewed as substitutes for Revenue,

net Income, or any other operating performance measure calculated by GAAP.

Finally, we rely on these non-GAAP financial measures to plan

and forecast for future periods.

definition of “Adjusted Revenue” is the sum of all gross revenues.

Similarly, we define “Adjusted Net (Loss) Income”

as pre-tax earnings before accounting for share-based compensation expense, impairment loss on investments, accrual of legal fees and

deferred tax accrual, and the applicable tax effects of these adjustments.

We add back Salesforce expenses and capitalize them with a

20% depreciation rate.

We also add deferred government grants in current Income to arrive at Adjusted EBITDA.

Lastly, our definition

of “Adjusted Diluted (Loss) Earnings Per Share” is derived after adjusting for the abovementioned items.

definitions of each non-GAAP financial measure allow us to add back certain cash and non-cash charges and deduct certain gains included

in calculating total revenues, net, and net Income attributable to Pineapple Financial Inc.

or net Income.

However, these expenses and

gains vary greatly and are difficult to predict.

From time to time in the future, we may include or exclude other items if we believe

that doing so is consistent with providing useful information to investors.

we use non-GAAP financial measures to evaluate our business performance, it’s important to note that they do not include certain

necessary costs to operate our business.

These measures can help demonstrate the long-term impact of our strategies.

Still, they should

not be considered an indication that our future results will be unaffected by unusual or non-recurring items.

It’s important to

note that non-GAAP financial measures have limitations as analytical tools and should not be used in isolation or as a substitute for

analyzing our results as reported under U.S.

These measures cannot be relied upon as a measure of discretionary cash available

to invest in the growth of our business or as a measure of money available to us to meet our obligations.

to our non-GAAP financial measures included, but are not limited to:

do not reflect every cash expenditure, future requirements for capital expenditures or contractual

EBITDA does not reflect the significant interest expense or the cash requirements necessary

to service interest or principal payment on our debt;

depreciation and amortization are non-cash charges, the assets being depreciated and amortized

will often have to be replaced or require improvements in the future, and Adjusted Revenue,

Adjusted Net Income (Loss) and Adjusted EBITDA do not reflect any cash requirement for such

replacements or improvements;

are not adjusted for all non-cash income or expense items reflected in our Consolidated Statements

of Cash Flows.

better evaluate our operating performance, we utilize non-GAAP financial measures and other comparative tools, in addition to U.S.

measurements, which address certain limitations.

The reconciliation of our non-GAAP financial measures to their corresponding U.S.

measures can be found below.

Furthermore, our U.S.

GAAP-based measures are available in the consolidated financial statements and related

notes, which are included in Form 10-K.

Reconciliation

of Adjusted Revenue to Total Revenue, net

Year Ended August 31,

Total Revenue, net

Commission expense

Gross Revenue

Reconciliation

of Adjusted Net (Loss) Income to Net Income Attributable to Pineapple Financial Inc.

Year Ended August 31,

Net Income attributable to Pineapple Financial

Share-based compensation

Salesforce expenses – net of depreciation

Government based incentive

Investment impairment

Legal fee accrual

Adjusted EBITDA

Reconciliation

of Adjusted Diluted Weighted Average Shares Outstanding to Diluted Weighted Average Shares Outstanding

Year Ended August 31,

Weighted average common shares outstanding

Adjusted EBITDA

Adjusted Diluted (Loss)) Earning per share

fiscal year ended August 31, 2024, we generated $ 1.529 billion in residential mortgage loans compared to $1.399 billion in the previous

financial year, which ended on August 31, 2023.

This amount represents an increase of $130.462 million or 9.33% compared to the same

period that ended on August 31, 2023.

Our net loss stood at $4.102 million for the year ended August 31, 2024, as compared to the $2.809

million recorded in the same period on August 31, 2023.

Performance Indicators

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1,398,464,338

Sales revenue

1,785,424,632

Gross billing

Commission expense

2 unchanged sentences

Subscription revenue

of Certain Components of Financial Data

sources of revenue include commissions from lenders, underwriting revenue, membership fees from mortgage agents, and other income.

Revenue is commission collected from financial institutions with whom it has contracts in place.

The Company earns revenue based on a

percentage of mortgage amount funded between individual referred by the Company and financial institutions funding the mortgage.

an agent in these deals as we provide the platform for other parties to provide services to the end-user.

For each contract with a customer,

the Company identifies the contract with a customer;

identifies the performance obligations in the contract;

determines the transaction

price to the separate performance obligations on the basis of the relative stand-alone selling price of each distinct good or service

to be delivered;

and recognizes revenue when or as each performance obligation is satisfied in a manner that depicts the transfer to

the customer of the goods or services promised.

Billing Revenue:

billing revenue refer to commission collected from financial institutions with whom it has contracts in place.

The Company’s

gross billing is based on a percentage of mortgage amount funded between individual referred by the Company and financial institutions

funding the mortgage.

We are an agent in these deals as we provide the platform for other parties to provide services to the end-user.

For each contract with a customer, the Company identifies the contract with a customer;

identifies the performance obligations in the

determines the transaction price to the separate performance obligations on the basis of the relative stand-alone selling price

of each distinct good or service to be delivered;

and recognizes revenue when or as each performance obligation is satisfied in a manner

that depicts the transfer to the customer of the goods or services promised.

The Company recognizes revenue when:

a contract exists with a lender party and an agent

broker, the contract identifies the use of the platform service to close a mortgage deal, the mortgage deal has been closed with the

lending financial institution, and commissions paid by the lending financial institution based on various criteria of the mortgage deal

including but not limited to interest rates available at that time, term, seasonality, collateral, income, purpose, etc.

Revenue is measured

at the fair value of the consideration received or receivable and represents amounts receivable for services provided in the normal course

a contract exists with

a lender party and an agent broker, the contract identifies the use of the platform service to close a mortgage deal, the mortgage deal

has been closed with the lending financial institution, and commissions paid by the lending financial institution based on various criteria

of the mortgage deal including but not limited to interest rates available at that time, term, seasonality, collateral, income, purpose,

Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for services

provided in the normal course of business.

Revenue is recognized at the end of the deal upon completion of all the actions listed above.

A typical transaction attracts

a commission fee payable to Pineapple Financial Inc.

access and use our technology platform, MyPineapple, for a flat monthly service fee of $118.

In exchange for this fee, users of MyPineapple

A typical transaction attracts a commission fee payable to Pineapple Financial Inc.

access and use our technology platform, MyPineapple, for a flat monthly service fee of $117 In exchange for this fee, users of MyPineapple

have access to a network management system that allows them to perform back- office procedures more efficiently and effectively.

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40% of the deals originated by users are using this service.

This program intends to further increase the number of deals and improve

the services offered.

This program is intended to further increase the number of deals and

improve the services offered.

income includes a technology setup fee and sponsorship fee.

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operating expenses.

compensation comprises equity awards and is measured and expensed accordingly under Accounting Standards Codification (“ASC”)

718 Compensation—Stock Compensation.

compensation comprises equity awards and is measured and expensed accordingly under Accounting Standards Codification

(“ASC”) 718 Compensation—Stock Compensation.

of the years ended August 31, 2024 and 2023

Revenue decreased from $20.381 million in the fiscal year ending August 31, 2022, to $16.434 million in the fiscal year ending August

31, 2023, representing a 19.37% decrease from year to year.

To control high inflation, The Bank of Canada increased the interest rate

from 2.5% as of September 01, 2022, to 5.00% as of August 31, 2023.

This resulted in decreased real estate transactions and, eventually,

in the mortgage business.

The number of real estate transactions in Canada fell from 558,591 houses during the year ended August 31,

2022, to 441,536 houses during the year ended August 31, 2023, representing a 21.02% decrease.

Profit Percentage

Financials’ gross margin decreased to 15.23% during the year ended August 31, 2023, from 17.67% during the year ended August 31,

This decrease was due to more volume by high-volume agents with low margins.

the financial year that ended August 31, 2023, the cost of revenue decreased to $13.932 million from $16.780 million during the previous

year that ended August 31, 2022.

The decrease in the cost of Revenue is due to the decline in Revenue.

general and administrative

and Marketing

wages and benefits

expense and bank charges

Total expense

Gain on extinguishment of liability

exchange gain (loss)

on change in fair value of warrant liability

on change in fair value of conversion feature liability

billings increased from $15.027 million for the fiscal year ending August 31, 2023, to $16.264 million for the fiscal year ending August

31, 2024, representing a year-over-year increase of 8.23%.

To address high inflation, the Bank of Canada increased its policy rate from

2.5% on September 1, 2022, to 5.0% by August 31, 2023.

However, beginning June 5, 2024, the Bank of Canada initiated rate reductions,

decreasing the policy rate by 125 basis points to 3.75%.

While this reduction has the potential to bolster consumer confidence, the real

estate market remains subdued, contributing to decreased real estate transactions and a corresponding decline in mortgage activity.

Revenue for the year ended August 31, 2024, increased

to $2,688,988 from $2,502,264 in the year ended August 31, 2023, representing a 7.46% year-over-year growth.

This increase is primarily

attributed to the Company’s efforts in enhancing its software offerings, which improved customer retention and attracted new agents.

Additionally, strategic investments in marketing and operational efficiency during a challenging economic environment contributed to

this positive performance despite the broader contraction in the mortgage origination market.

This growth reflects the resilience of

the Company’s business model and its ability to adapt to fluctuating market conditions.

of gross billing

the fiscal year ended August 31, 2024, the cost of revenue increased to $14.895 million, compared to $13.932 million in the prior fiscal

year ended August 31, 2023.

This increase aligns with the growth in gross billing and reflects higher transaction volumes.

Additionally,

the cost increase is attributed to the company’s strategic focus on leveraging high-volume agents to drive business, who typically

operate at lower margins but generate higher transaction volumes, resulting in increased variable costs.

General and Administrative Expenses.

breakdown of selling, general and administrative expenses are as follows:

Ended August 31,

Increase/(Decrease)

marketing and promotions

and award shows

and subscriptions

and maintenance

general and administrative expenses increased by $37,668 from $2,977,277 during the year ended August 31, 2022, to $3,014,945 during

Software subscription

Office and general

Professional fee

Dues and subscription

Consulting fee

Lease expense

general, and administrative expenses increased by $212,076, or 9.77%, from $2,170,149 during the fiscal year ended August 31, 2023, to

$2,382,225 during the fiscal year ended August 31, 2024.

This increase reflects the company’s disciplined approach to maintaining

essential expenses amidst a depressed economic environment.

Adjusting for inflation, expenses effectively decreased in real terms, demonstrating

the company’s commitment to cost efficiency and prudent financial management while ensuring sustained support for core operations

and strategic initiatives.

subscription expenses increased by $81,957, or 10.03%, from $816,913 for the year ended August 31, 2023, to $898,870 for the year ended

August 31, 2024.

This increase is primarily attributable to the continued development and enhancement of our proprietary software, which

necessitated the use of complementary third-party subscription tools.

These tools have been critical in ensuring the software meets industry

standards and client expectations.

Once our proprietary software is fully developed, reliance on external subscriptions is expected to

decrease significantly, leading to long-term cost savings and improved operational efficiency.

and general expenses increased by $11,938 or 6.36%, from $187,818 for the fiscal year ended August 31, 2023, to $199,756 for the fiscal

year ended August 31, 2024.

This increase reflects the cost increase due to inflation.

fees decreased by $201,783, or 30.52%, from $661,265 for the fiscal year ended August 31, 2023, to $414,482 for the fiscal year ended

August 31, 2024.

This significant decrease is primarily attributable to the completion of IPO-related activities on November 3, 2023,

which resulted in a reduction in legal, accounting, and advisory expenses.

During the prior year, the company incurred substantial costs

to achieve the IPO milestone.

The decrease also reflects the transition to a steady-state operating environment post-IPO, with reduced

reliance on external consultants and professional services.

and subscriptions increased significantly from $58,366 during the year ended August 31, 2023, to $269,106 for the year ended August 31,

2024, representing a 361.07% increase.

This substantial rise is primarily attributable to additional regulatory and listing fees incurred

following the Company’s IPO, including NYSE subscription fees and other compliance-related charges.

These fees are essential to

maintaining our public listing and ensuring compliance with the regulatory requirements of a publicly traded company.

fees decreased significantly by $147,465, or 70.20%, from $210,063 for the fiscal year ended August 31, 2023, to $62,598 for the fiscal

year ended August 31, 2024.

This decline is primarily attributed to the completion of IPO-related activities, which required substantial

consulting support in the prior year.

The decrease also reflects the company’s strategic shift toward utilizing in-house resources

for post-IPO operations and a focus on optimizing recurring expenses to align with the company’s long-term cost management initiatives.

expenses increased by $63,271, or 64.98%, from $97,372 for the fiscal year ended August 31, 2023, to $160,643 for the fiscal year ended

August 31, 2024.

This increase reflects higher management travel to attend investor conferences and engage with stakeholders to present

the company’s vision and growth strategy, a critical activity following the IPO.

Additionally, the company prioritized in-person

meetings with institutional investors and partners to strengthen relationships, which are expected to drive long-term value creation.

Advertising and marketing

Salaries, wages and benefits

Interest expense and bank charges

Share based compensation

Government incentive

marketing, and promotions expenses increased by $15,250, or 1.81%, from $844,797 for the year ended August 31, 2023, to $860,047 for

the year ended August 31, 2024.

This increase represents a 1.27% increase.

subscriptions decreased by $106,224, representing 11.51% from $923,137 during the year ended August 31, 2022, to $816,913.

to less reliance on third-party software as internal software develops more.

marketing and promotions decreased from $795,588 to $649,934, representing a decrease of 18.31% during the year ended August 31, 2022

and August 31, 2023.

This decrease is due to a depressed real estate market.

and general expenses decreased to $183,868 during the year ending August 31, 2023, from $259,480 during the year ended August 31, 2022.

This represents a decrease of $75,611 or 29.14% yearly.

This decrease is mainly due to reduced revenue.

fees increased to $661,265 during the financial year ended August 31, 2023, from $243,100 during the year ended August 31, 2022.

172.01% increase is due to the preparation of our initial public offering (IPO) expenses.

and subscriptions decreased from $174,743 during the year ended August 31, 2022, to $58,366 for the year ended August 31, 2023, representing

a 66.60% decrease.

consulting fee was increased from $146,554 during the year ended August 31, 2022, to $210,063 during the year ended August 31, 2023.

This 43.34% increase was due to hiring consultants for our IPO process.

Wages and benefits

Ended August 31,

Increase/(Decrease)

wages and benefits

wages and benefits remain almost the same during the year that ended August 31, 2023 compared to the previous year, which ended on August

Ended August 31,

Increase/(Decrease)

financial is actively investing in the development of its software.

During the year under review, $1.300 million were added in intangible

This addition represents mostly the salaries, wages and benefits of our staff working on intangible asset.

These additions are

the main cause of increase of depreciation during the year ended August 31, 2023.

Ended August 31,

Increase/(Decrease)

the year ended August 31, 2023, no grant of options was granted.

based incentive

Ended August 31,

Increase/(Decrease)

This increase reflects the company’s strategic efforts to retain agents and sustain sales revenue

amidst challenging economic and real estate market conditions.

Additional investments were made to enhance brand visibility and strengthen

relationships with key stakeholders to maintain market share during this period of economic uncertainty.

These initiatives are expected

to position the company for growth as market conditions improve.

wages, and benefits increase by $106,656, or 4.58%, from $2,330,127 for

the fiscal year ended August 31, 2023, to $2,436,783 for the fiscal year ended August 31, 2024.

This nominal increase reflects the company’s

efforts to align compensation with inflation while maintaining a disciplined approach to expense management.

The nominal increase also

supports retaining key talent and ensuring competitive employee benefits during a challenging economic environment, which is essential

for sustaining business continuity and future growth.

and Amortization

Financial continues to actively invest in the development of its proprietary software to enhance functionality and meet market demands.

During the fiscal year ended August 31, 2024, $1.112 million was capitalized as intangible assets, primarily representing salaries, wages,

and benefits of staff directly involved in the development process.

This strategic investment underscores the Company’s commitment

to innovation and long-term growth.

The increase in intangible assets has contributed to higher amortization expenses during the year,

reflecting the progressive utilization of these investments in delivering value to our operations and clients.

based incentive

the year ended August 31, 2023, the Company claimed Scientific Research and Experimental Development (SR&ED) from the CRA for the

years ending August 31, 2022 and August 31, 2021.

These claims were approved and received during the year ended August 31, 2023.

the fiscal year ended August 31, 2023, the Company successfully claimed and received Scientific Research and Experimental Development

(SR&ED) tax credits from the CRA for the fiscal years ended August 31, 2022, and August 31, 2021.

These claims provided a valuable

source of non-dilutive funding to support the Company’s innovation initiatives.

However, following the completion of our IPO on

November 3, 2023, the Company no longer qualifies for SR&ED tax credits under CRA regulations, resulting in a decrease in credit

recognition for the fiscal year ended August 31, 2024.

This change reflects the Company’s transition to a publicly traded status,

and we are actively exploring alternative funding opportunities to support ongoing research and development efforts.

and Capital Resources

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following table summarizes our cash flows from operating, investing and financing activities:

Ended August 31,

Increase/(Decrease)

(used) provided in operating activities

(used) provided by financing activities

(used) provided in investing activities

at the end of the period

Cash (used) provided in operating activities

Cash (used) provided by financing activities

Cash (used) provided in investing activities

Cash at the end of the period

cash flow from (used in) operating activities

Ended August 31,

for the following non-cash items:

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of investment

in fair value of warrant liabilities

on extinguishment of liability

exchange gain (loss)

in fair value of conversion feature liability

changes in non-cash working capital balances:

5 unchanged sentences

primary source of cash flow comes from our core business operations.

the year ended August 31, 2023, the Company’s net cash used in operating activities increased to $2,116,105 from $1,834,909 in

the previous year.

This increase of outflow of cash was primarily due to a net loss of $2,809,036.

Additionally, prepaid expenses and

deposits decreased by $601,905, and accounts payable and accrued liabilities were reduced by $557,089.

the year ended August 31, 2024, the Company’s net cash used in operating activities decreased to $1,708,261 from $2,116,105 in

the previous year ended August 31, 2023.

This decrease of outflow of cash was primarily due to lower cash expenses as compared to the previous year.

cash flow from (used in) financing activities

the year ended August 31, 2023, the Company received $430,098 in financing from Easily Financing for working capital support.

Additionally,

the Company fulfilled its lease payments during the year.

the fiscal year ended August 31, 2024, the Company successfully closed its Initial Public Offering (IPO) on November 3, 2023, generating

net proceeds of $2,751,937.

These funds have strengthened the Company’s financial position and provided critical capital to support

strategic initiatives, including investments in proprietary software development, expansion of operational capabilities, and enhancing

shareholder value.

The successful IPO marks a significant milestone in the Company’s growth journey, enabling access to broader

capital markets and positioning the business for future opportunities.

In addition, company issued share capital through conversion note

and equity purchase agreement with Brownstone.

cash flow from (used in) investing activities

Company invested $1,300,225 to develop software for quick and accurate mortgage application filling by field agents during the year ended

August 31, 2023.

These investments will help the company acquire more mortgage agents in the future.

the fiscal year ended August 31, 2024, the Company invested $1,112,399 in developing proprietary software designed to streamline and

enhance the accuracy of mortgage application processes for field agents.

This investment reflects the Company’s commitment to leveraging

technology to improve operational efficiency and provide a competitive edge in the mortgage industry.

The enhanced software is expected

to not only attract new mortgage agents but also improve agent retention by offering a comprehensive and user-friendly solution, positioning

the Company for sustainable growth in a competitive market.

of August 31, 2024, the Company’s cash balance was $580,356, a decrease from $720,365 on August 31, 2023.

Company’s capital structure comprises of contributed common shares, an accumulated deficit, additional paid-in capital, and other

comprehensive losses.

Its primary sources of liquidity are cash generated through operations and cash received from investors in exchange

for the issuance of common shares.

The business aims to meet all its financial and other obligations as they come due.

capital requirements will depend on various factors, including our investment in technology and growth rate.

However, certain aspects,

like interest rates and real estate markets, are beyond our control.

Company’s capital structure consists of contributed common shares, accumulated deficit, additional paid-in capital, and other comprehensive

Its primary sources of liquidity are cash generated through operations and capital raised from investors through the issuance

of common shares.

The Company remains committed to meeting all financial and operational obligations as they come due, maintaining a

disciplined approach to liquidity management.

capital requirements will depend on several factors, including planned investments in technology, market expansion initiatives, and overall

growth trajectory.

While the Company continues to actively manage controllable factors, external variables such as interest rates and

real estate market conditions remain potential challenges.

By aligning its financial strategies with operational priorities, the Company

is well-positioned to navigate these uncertainties and achieve sustainable long-term growth.

following table presents our liquidity:

Ended August 31,

and cash equivalents

and other receivables

expenses and deposit

tax receivable

of August 31, 2023, Pineapple has a healthy liquidity position with $720,365 in cash and cash equivalents.

The trade and other receivables,

prepaid expenses and deposits indicate that the Company can meet its obligations.

However, there was a decrease of $3,176,474 in cash

and cash equivalents from August 31, 2022, to August 31, 2023.

This was mainly due to the expansion of our operations and investment

in technology.

Additionally, the Canadian real estate market, inflation, and the continuous hike of interest rates by the Bank of Canada

have also affected the Company’s operations and impacted its liquidity.

Trade and other receivables

Prepaid expenses and deposit

of August 31, 2024, Pineapple Financial maintained a liquidity position with $580,356 in cash and along with trade

and other receivables, prepaid expenses, and deposits, demonstrating the Company’s ability to meet its short-term obligations.

However, cash decreased by $140,009 compared to August 31, 2023.

This decrease was primarily driven by strategic

investments in the expansion of operations and technology development to strengthen the Company’s competitive position.

Additionally,

broader macroeconomic challenges, including a depressed Canadian real estate market and economic headwinds, have impacted liquidity during

Despite these challenges, Pineapple Financial remains focused on prudent financial management, ensuring that resources are

allocated efficiently to support growth while maintaining sufficient liquidity to meet ongoing obligations.

Accounting Policies and Significant Judgments and Estimates

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a new contract- based revenue recognition model with a measurement approach that is based on an allocation of the transaction price.

establishes a five-step model to account for Revenue arising from contracts with customers.

It establishes a five-step model to account for Revenue arising from contracts with customers.

Under this standard, Revenue is recognized

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Alliance is a mortgage brokerage firm based in Ontario, Canada with locations in Calgary, Vancouver and Halifax.

Both represent a total investment as of May 31, 2023 of $36,830.

total amount of both investments was recorded at fair value, and any impairment loss is recognized in profit and loss account.

18 unchanged sentences

granted on June 14, 2021, vest over a 2-year period whereby 25% of the options granted vested on the date of grant, and the remaining

unvested options vest in equal installments every 6-months thereafter.

unvested options vest in equal instalments every 6-months thereafter.

The fair value of stock options granted was $1,317,155.

stock-based compensation expense was recognized of $57,340 for the vested options (August 31, 2021 - $637,517).

Chief Financial Officer was granted 63,821 Stock options on November 15, 2021 as part of his compensation package.

The options vest over

a 3-year period whereby 8,974 of the options granted vested on the grant date and the remaining unvested options vest in equal installments

every 6-months thereafter.

The fair value of the stock options granted was $141,885.

The Chief Financial Officer options were forfeited

and a recovery on stock-based compensation of $24,250 was recognized during the year ended August 31, 2023.

For year ended August 31,

2023, stock-based compensation expense of $nil (August 31, 2022 - $85,700) was recognized.

These options were fully vested in year ended August 31, 2023.

July 6, 2023, we completed a 1-for-3.9 reverse stock split, or the Reverse Split, effective immediately.

3 unchanged sentences

and Procedures

we are currently not required to maintain an effective internal controls system, we have assessed and already started creating our internal

controls as we have determined the need to maintain effective and controlled systems including but not limited to:

skilled staffing for financial, accounting and external reporting areas, including segregation of duties;

reconciliation of accounts as necessary to ensure correct classification, accurate recording and balancing of books;

proper recording of expenses, liabilities, and other accounting entries in the period to which they relate as per the matching principle;

maintaining a fixed assets register that identifies user, department, and detailed tracking;

evidence of internal review and approval of accounting transactions by 2 or more independent personnel;

documentation of processes, assumptions and conclusions underlying significant estimates;

documentation of accounting policies and procedures.

Company currently uses NetSuite, a proprietary financial accounting software from Oracle Corporation for recording, tracking and financial

However, external resources may be required such as professional consultants to determine more specific internal controls

to decrease exposure to erroneous financial reporting which the Company is significantly deficient to meet the necessary regulatory requirements

and responsibilities, and ensure compliance in all respects thereby incurring significant expenses in meeting these needs.

31, 2023, under the supervision and with the participation of our management, including our principal executive officer and principal

financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting and based on this

assessment, our management concluded that, as of August 31, 2023, our internal controls over financial reporting lacked adequate segregation

of duties within the accounting and system process, inadequate documentation to evidence the operation of controls, inconsistent procedures

and approvals and insufficient written policies and procedures for accounting, IT and financial reporting and record keeping.

implementing plans to improve such internal control.

the Company is not currently required to maintain an effective internal controls system, we recognize the importance of strong internal

controls and have proactively initiated steps to establish and enhance our control environment.

These measures include:

skilled staff in financial, accounting, and external reporting roles, focusing on segregation

regular reconciliations to ensure accurate recording, correct classification, and balanced

timely and accurate recording of expenses, liabilities, and other accounting entries in accordance

with the matching principle.

● Maintaining

a detailed fixed assets register to track users, departments, and assets.

internal review and approval of accounting transactions by at least two independent personnel.

● Documenting

processes, assumptions, and conclusions related to significant estimates.

● Establishing

comprehensive documentation of accounting policies and procedures.

of August 31, 2024, under the supervision and with the participation of management, including our principal executive officer and principal

financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting.

Based on this assessment,

management concluded that our disclosure controls and procedures were effective as of August 31, 2024.

made during the year include implementing independent reviews, approval processes for transactions and reconciliations, and hiring additional

personnel to strengthen our control environment.

Plans are underway to further enhance controls by segregating duties and improving processes,

ensuring robust and effective internal controls that support the integrity of our financial reporting.

on August 31, 2024, the Company’s financial instruments consist of cash, trade and other receivables, investments, accounts payable

2 unchanged sentences

the inputs used to measure fair value.

A financial instrument’s categorising within the fair value hierarchy is based upon the

A financial instrument’s categorizing within the fair value hierarchy is based upon the

lowest level of input that is significant to the fair value measurement.

2 unchanged sentences

the asset or liability, either

(i.e., as prices) or indirectly (i.e., derived from prices);

directly (i.e., as prices) or indirectly (i.e., derived from prices);

Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not

2 unchanged sentences

categorized by hierarchical levels and their related classifications.

of August 31, 2023

As of August 31, 2024

and Uncertainties

4 unchanged sentences

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 7. Management’s Discussion and Analysis