What changed in this filing

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Item 1. Financial Statements

2025-05-15 compared with 2025-02-14 · 1206 added, 859 removed, 656 unchanged (76% of the section changed)

Financial Statements

HOLDING LIMITED

LAKESIDE HOLDING LIMITED

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2025 AND JUNE 30, 2024

CURRENT ASSETS

3 unchanged sentences

Contract assets

Inventory, net

Inventories, net

Due from related parties

19 unchanged sentences

Loans payable, current

Contract liabilities

Dividend payable

Due to shareholders

Convertible notes - current

Total current liabilities

1 unchanged sentence

Loans payable, non-current

Loan payable to a related party

Deferred tax liabilities

1 unchanged sentence

Obligations under financing leases, non-current

Convertible note - non-current

Total non-current liabilities

1 unchanged sentence

Commitments and Contingencies

Common stocks, $ 0.0001 par value, 200,000,000 shares authorized, 7,500,000 and 6,000,000 issued and outstanding as of December 31, 2024 and June 30, 2024, respectively

Common stocks, $ 0.0001 par value, 200,000,000 shares authorized, 7,500,000 and 6,000,000 issued and outstanding as of March 31, 2025 and June 30, 2024, respectively

Subscription receivable

Additional paid-in capital

Accumulated other comprehensive income

Statutory reserve

( 4,365,856 )

Accumulated other comprehensive income

TOTAL LIABILITIES AND EQUITY

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

HOLDING LIMITED

CONDENSED CONSOLIDATED STATEMENT OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)

Six Months Ended

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

LAKESIDE HOLDING LIMITED

CONDENSED CONSOLIDATED STATEMENT OF INCOME (LOSS)

AND COMPREHENSIVE INCOME (LOSS)

FOR THE THREE MONTHS AND NINE MONTHS ENDED MARCH

31, 2025 AND 2024

Nine Months Ended

Three Months Ended

5 unchanged sentences

Cost of revenue from cross-border freight solutions – related party

Cost of revenue from pharmaceutical products – related parties

Cost of revenue from pharmaceutical products – third parties

Total cost of revenue

Gross profit (loss)

Operating expenses:

4 unchanged sentences

Total operating expenses

Income (loss) from operations

(Loss) income from operations

( 4,399,378 )

6 unchanged sentences

( 1,052,202 )

Income tax expense (credit)

Income tax expense

Net (loss) income

6 unchanged sentences

Other comprehensive (loss) income:

Foreign currency translation income

Foreign currency translation (loss) income

Comprehensive (loss) income

6 unchanged sentences

$ ( 1,067,213 )

( Loss) earnings per share – basic and diluted

Loss per share – basic and diluted

Weighted Average Shares Outstanding – basic and diluted

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

HOLDING LIMITED

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

LAKESIDE HOLDING LIMITED

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS AND SIX MONTHS ENDED DECEMBER 31, 2024 AND 2023

For The Three Months Ended December 31, 2023

Common Shares

Earnings (Deficits)

FOR THE THREE MONTHS AND NINE MONTHS ENDED MARCH 31, 2025 AND 2024

For The Three Months Ended March 31, 2024

Other Comprehensive Income

Balance at September 30, 2023

Balance at December 31, 2023

For The Six Months Ended December 31, 2023

Common Shares

Earnings (Deficits)

Balance at March 31, 2024

For The Nine Months Ended March 31, 2024

Other Comprehensive Income

Balance at June 30, 2023

Net income (loss) for the period

Net loss for the period

Termination of S Corporation upon reorganization

1 unchanged sentence

Foreign currency translation adjustment

Balance at March 31, 2024

For The Three Months Ended March 31, 2025

Comprehensive

Income (Loss)

Balance at December 31, 2024

For The Three Months Ended December 31, 2024

Common Shares

Earnings (Deficits)

Other Comprehensive Income

Balance at September 30, 2024

$ ( 3,288,046 )

1 unchanged sentence

( 1,070,796 )

Statutory reserve

Foreign currency translation adjustment

Balance at December 31, 2024

Issuance of convertible note

Balance at March 31, 2025

$ ( 4,365,856 )

For The Six Months Ended December 31, 2024

Common Shares

Earnings (Deficits)

Other Comprehensive Income

For The Nine Months Ended March 31, 2025

Comprehensive

Income (Loss)

Balance at June 30, 2024

2 unchanged sentences

( 4,353,023 )

Statutory reserve

Initial public offering, net of share issuance costs

Foreign currency translation adjustment

Balance at December 31, 2024

Issuance of convertible note

Balance at March 31, 2025

$ ( 4,365,856 )

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

HOLDING LIMITED

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

LAKESIDE HOLDING LIMITED

CONDENSSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended

FOR THE NINE MONTHS ENDED MARCH 31, 2025 AND 2024

For the Nine Months Ended

Cash flows from operating activities:

4 unchanged sentences

Depreciation – cost of revenue

Amortization of intangible asset

Amortization and interest expense of operating lease assets

1 unchanged sentence

Provision of allowance for expected credit loss

Interest expense of convertible note

Deferred tax expense

Interest income

Loss from derecognition of shares in subsidiary

5 unchanged sentences

Due from related parties

Prepayment, other deposit

Due to related party

Prepayment and other deposit

Accounts payables – third parties

Accounts payables – related parties

Contract liabilities

Accrued expense and other payables

Operating lease liabilities

( 1,151,931 )

Net cash (used in) provided by operating activities

12 unchanged sentences

Repayment of loans

Net proceeds from issuance of convertible notes

Proceeds from a loan from a related party

Repayment of equipment and vehicle loans

3 unchanged sentences

Proceeds from initial public offering, net of share issuance costs

Advanced to related parties

Advances to related parties

Proceeds from shareholders

11 unchanged sentences

Deferred offering costs within accrued expense and other payables

Additions to property and equipment included in loan payable

Additions to leasehold improvement and furniture and fixture through account payable

Settlement of due to shareholder and advance to related party

Property additions included in loan payable

Additions to leasehold improvement through accounts payable and other payable

Due to shareholder offset against due from related parties

NON-CASH ACTIVITIES

6 unchanged sentences

Loss from deconsolidation of a subsidiary

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

HOLDING LIMITED

The accompanying notes are an integral part of

these unaudited condensed consolidated financial statements.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1 — ORGANIZATION AND BUSINESS DESCRIPTION

Holding Limited (the “Company”), is a holding company established on August 28, 2023 under the laws of the State of

The Company, acting through its subsidiary, is primarily engaged in providing customized cross-border ocean freight solutions

and airfreight solutions.

On July 1, 2024, the Company closed its initial public offering (“IPO”) of 1,500,000 shares of

its common stock at an IPO price of $ 4.50 per share for aggregate gross proceeds of approximately $ 6.75 million from the offering (Note

In connection with the offering, the Company’s common shares began trading on the Nasdaq Capital Market under the trading

symbol “LSH.”

of December 31, 2024, the Company’s subsidiaries are as follows:

NOTE 1 — ORGANIZATION AND BUSINESS DESCRIPTION

Lakeside Holding Limited (the

“Company”), is a holding company established on August 28, 2023 under the laws of the State of Nevada.

The Company, acting

through its subsidiary, is primarily engaged in providing customized cross-border ocean freight solutions and airfreight solutions.

On July 1, 2024, the Company closed its initial public offering (“IPO”) of 1,500,000 shares of its common stock at an IPO

price of $ 4.50 per share for aggregate gross proceeds of approximately $ 6.75 million from the offering (Note 16).

In connection with the

offering, the Company’s common shares began trading on the Nasdaq Capital Market under the trading symbol “LSH.”

As of March 31, 2025, the

Company’s subsidiaries are as follows:

Incorporation/

Jurisdiction of

Acquisition Jurisdiction of

Formation Percentage of

16 unchanged sentences

The transaction was completed on November 21, 2024.

Reorganization

reorganization of the legal structure was completed on September 23, 2023 (“The Reorganization”).

The Reorganization

involved the incorporation of Lakeside Holding Limited and the transfer the shares of American Bear Logistics Corp (“ABL Chicago”)

to the Company.

HOLDING LIMITED

*** Subsequent to period-end, Hupan New Energy and Wuhan Ruixinda was deregistered on April 8, 2025 and May 12, 2025, respectively.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1 — ORGANIZATION AND BUSINESS DESCRIPTION (cont.)

NOTE 1 — ORGANIZATION AND BUSINESS DESCRIPTION (cont.)

Reorganization

to the Reorganization, Mr.

Henry Liu, the Chairman of the Board and Chief Executive Officer (“CEO”), and Mr.

Li, the President, each owned 50 % equity interest of the ABL Chicago (collectively, the “Controlling Group”).

On September 23,

2023, the Controlling Group transferred their 100 % equity interest in ABL Chicago to the Company for a consideration of $ 1,000 .

this Reorganization, the Company ultimately owns 100 % equity interest of ABL Chicago.

part of the series of reorganization transactions to be completed before the offering, a 120-for-1 share split was conducted by

the Company on March 29, 2024.

After the share split, the issued share capital of the Company consists of $ 600 divided into 6,000,000

common shares, par value of $ 0.0001 each.

and after the Reorganization, the Company, together with its subsidiaries, is effectively controlled by the same Controlling Group, and

therefore the Reorganization is considered as a recapitalization of entities under common control in accordance with Accounting Standards

Codification (“ASC”) 805-50-25.

The consolidation of the Company and its subsidiaries have been accounted for at historical

cost and prepared on the basis as if the aforementioned transactions had become effective as of the beginning of the first period presented

in the accompanying consolidated financial statements in accordance with ASC 805-50-45-5.

July 1, 2024, the Company closed its IPO of 1,500,000 shares of its common stock at an IPO price of $ 4.50 per share for aggregate gross

proceeds of approximately $ 6.75 million from the offering.

The total net proceeds to the Company from the IPO, after deducting discounts,

expense allowance, and expenses, were approximately $ 5.79 million (Note 12).

As at July 1, 2024, 7,500,000 shares of common stock are

issued and outstanding.

As of the date of this report, the Controlling Group collectively holds 76.0 % equity interest of the Company

through H&L Logistics International LLC which holds 36.0 % equity interest of the Company, and Jiushen Transport LLC, which holds

40.0 % equity interest of the Company.

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

of presentation and principles of consolidation

accompanying unaudited condensed consolidated financial statements include the accounts of Lakeside Holding Limited and its wholly owned

subsidiaries (collectively the “Company”).

In the opinion of the Company’s management, the condensed consolidated financial

statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation.

preparation of these unaudited condensed consolidated financial statements and accompanying notes in conformity with U.S.

generally accepted

accounting principles (“GAAP”) requires the use of management estimates.

These unaudited condensed consolidated financial

statements and accompanying notes should be read in conjunction with the Company’s annual consolidated financial statements and

accompanying notes included in its Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

HOLDING LIMITED

A reorganization of the legal

structure was completed on September 23, 2023 (“The Reorganization”).

The Reorganization involved the incorporation of

Lakeside Holding Limited and the transfer the shares of American Bear Logistics Corp (“ABL Chicago”) to the Company.

Prior to the Reorganization,

Henry Liu, the Chief Executive Officer (“CEO”), and Mr.

Shuai Li, the President, each owned 50 % equity interest

of the ABL Chicago (collectively, the “Controlling Group”).

On September 23, 2023, the Controlling Group transferred

their 100 % equity interest in ABL Chicago to the Company for a consideration of $ 1,000 .

Upon this Reorganization, the Company ultimately

owns 100 % equity interest of ABL Chicago.

As part of the series of reorganization

transactions to be completed before the offering, a 120-for-1 share split was conducted by the Company on March 29, 2024.

the share split, the issued share capital of the Company consists of $ 600 divided into 6,000,000 common shares, par value of $ 0.0001 each.

Before and after the Reorganization,

the Company, together with its subsidiaries, is effectively controlled by the same Controlling Group, and therefore the Reorganization

is considered as a recapitalization of entities under common control in accordance with Accounting Standards Codification (“ASC”) 805-50-25.

The consolidation of the Company and its subsidiaries have been accounted for at historical cost and prepared on the basis as if the aforementioned

transactions had become effective as of the beginning of the first period presented in the accompanying consolidated financial statements

in accordance with ASC 805-50-45-5.

On July 1, 2024, the Company

closed its IPO of 1,500,000 shares of its common stock at an IPO price of $ 4.50 per share for aggregate gross proceeds of approximately

$ 6.75 million from the offering.

The total net proceeds to the Company from the IPO, after deducting discounts, expense allowance, and

expenses, were approximately $ 5.79 million (Note 16).

As at July 1, 2024, 7,500,000 shares of common stock are issued and outstanding.

As of the date of this report, the Controlling Group collectively holds 76.0 % equity interest of the Company through H&L Logistics

International LLC which holds 36.0 % equity interest of the Company, and Jiushen Transport LLC, which holds 40.0 % equity interest of the

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation and principles of consolidation

The accompanying unaudited

condensed consolidated financial statements include the accounts of Lakeside Holding Limited and its wholly owned subsidiaries (collectively

the “Company”).

In the opinion of the Company’s management, the condensed consolidated financial statements reflect

all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation.

The preparation of these

unaudited condensed consolidated financial statements and accompanying notes in conformity with U.S.

generally accepted accounting principles

(“GAAP”) requires the use of management estimates.

These unaudited condensed consolidated financial statements and accompanying

notes should be read in conjunction with the Company’s annual consolidated financial statements and accompanying notes included

in its Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

Going concern

The accompanying condensed

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

realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future.

As of March 31, 2025, the

Company had an accumulated deficit of approximately $ 4.4 million and a working capital deficit of approximately $ 1.8 million.

nine months ended March 31, 2025, the Company incurred a net loss of approximately $ 4.4 million and the net cash used in operating activities

was approximately $ 2.2 million.

Losses have principally occurred as a result of the substantial resources required for general and administrative

expenses associated with our operations.

The continuation of the Company as a going concern is dependent upon the continued financial

support from its external financing.

The Company currently plans to fund its operations and support its ongoing acquisition projects mainly

through cash flow from loans, issuance of notes and additional equity financing from outside investors, if necessary, to ensure sufficient

working capital.

However, there is no assurance that the Company will be successful in securing sufficient funds to sustain the operations.

These factors, among others, raise the substantial doubt regarding

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

These condensed consolidated financial statements do not include any adjustments

to reflect the possible future effect on the recoverability and classification of assets or the amounts and classifications of liabilities

that may result from the outcome of these uncertainties.

Management believes that the actions presently being taken to obtain additional

funding and implement its strategic plan provide the opportunity for the Company to continue as a going concern.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

of estimates and assumptions

preparing the condensed consolidated financial statements in conformity with U.S.

GAAP, management makes 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 and the reported amounts of revenues and expenses during the reporting period.

These estimates are based on information as

of the date of the condensed consolidated financial statements.

Significant accounting estimates required to be made by management include

allowance for credit losses, the percentage of performance obligation completed at the reporting period.

The Company evaluates its estimates

and assumptions on an ongoing basis and its estimates on historical experience, current and expected future conditions and various other

assumptions that management believes are reasonable under the circumstances based on the information available to management at the time

these estimates and assumptions are made.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of estimates and assumptions

In preparing the condensed consolidated financial statements in conformity

GAAP, management makes 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 and the reported amounts of revenues and expenses during

the reporting period.

These estimates are based on information as of the date of the condensed consolidated financial statements.

accounting estimates required to be made by management include allowance for credit losses, the percentage of performance obligation completed

at the reporting period, the measurements of convertible notes with accompanying warrants.

The Company evaluates its estimates and assumptions

on an ongoing basis and its estimates on historical experience, current and expected future conditions and various other assumptions that

management believes are reasonable under the circumstances based on the information available to management at the time these estimates

and assumptions are made.

Actual results and outcomes may differ significantly from these estimates and assumptions.

consist of unrestricted balances held with banks and deposits at banks or other financial institutions, which are available for withdrawal

or use and have original maturities of three months or less.

The Company maintains its bank accounts in the United States, which

are insured by Federal Deposit Insurance Corporation (“FDIC”) and in mainland China, which are insured by the People’s

Bank of China Financial Stability Department (“FSD”) while there is a RMB 500,000 deposit insurance limit for a legal entity’s

aggregated balance at each bank.

of December 31, 2024 and June 30, 2024, the Company had approximately $ 1.1 million and $ 0.1 million of cash in banks, most held in the

banks located in the mainland of China and in the United States, respectively.

Most of cash balance as of December 31, 2024 and

June 30, 2024 are denominated in RMB and USD, respectively.

receivable, net

receivables are carried at the original invoiced amount less an estimated allowance for expected credit losses based on the probability

of future collection.

The Company reviews its accounts receivable on a periodic basis and makes general and specific allowances when

there is doubt as to the collectability of individual balances.

The Company grant credit to customers, without collateral, under normal

payment terms.

The Company uses a loss rate method to estimate the allowance for credit losses.

For those past due balances over one

year and other higher risk receivables identified by the Company are reviewed individually for collectability.

The Company evaluates

the expected credit loss of accounts receivable based on customer financial condition and historical collection information adjusted

for current market economic conditions and forecasts of future economic performance when appropriate.

Loss-rate approach is based

on the historical loss rates and expectations of future conditions.

The Company writes off potentially uncollectible accounts receivable

against the allowance for credit losses if it is determined that the amounts will not be collected.

As of December 31, 2024 and June 30,

2024, the Company recorded the allowance of credit loss of $ 56,022 and $ 54,066 , respectively.

are stated at the lower of cost or net realizable value, using the first-in, first out (FIFO) method.

Costs include the cost of pharmaceutical

products or solutions.

Any excess of the cost over the net realizable value of each item of inventories is recognized as a provision

for diminution in the value of inventories.

Net realizable value is estimated using selling price in the normal course of business less

any costs to complete and sell products.

HOLDING LIMITED

The estimated contract asset is based on the estimated completion percentage

of the performance obligation.

We believe that customers simultaneously benefit from the comprehensive services they provide.

For customers

with goods entering the United States, we offer customs clearance, container unloading, storage, unpacking, packing, and transportation

services to customer-specified locations after the goods arrive at a U.S.

seaport or airport.

For customers shipping goods overseas, we

provide cargo space arrangement, storage, packing, export customs clearance, and transportation to the seaport or airport for loading.

The performance obligation is satisfied over time as customers receive the benefits of these services during the process of transporting

goods from one location to another.

As a result, we recognize revenue over time.

We believe that the methodology employed is comparable

to that of other global logistics companies and offers faithful depiction of the services rendered to customers.

Cash consists of unrestricted

balances held with banks and deposits at banks or other financial institutions, which are available for withdrawal or use and have original

maturities of three months or less.

The Company maintains its bank accounts in the United States, which are insured by Federal Deposit

Insurance Corporation (“FDIC”) and in mainland China, which are insured by the People’s Bank of China Financial Stability

Department (“FSD”) while there is a RMB 500,000 deposit insurance limit for a legal entity’s aggregated balance at each

As of March 31, 2025 and June

30, 2024, the Company had approximately $ 1.5 million and $ 0.1 million of cash in banks, most held in the banks located in the mainland

of China and in the United States, respectively.

Most of cash balance as of March 31, 2025 and June 30, 2024 are denominated in RMB

and USD, respectively.

Accounts receivable, net

Accounts receivables are carried

at the original invoiced amount less an estimated allowance for expected credit losses based on the probability of future collection.

The Company reviews its accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the

collectability of individual balances.

The Company grant credit to customers, without collateral, under normal payment terms.

uses a loss rate method to estimate the allowance for credit losses.

For those past due balances over one year and other higher risk receivables

identified by the Company are reviewed individually for collectability.

The Company evaluates the expected credit loss of accounts receivable

based on customer financial condition and historical collection information adjusted for current market economic conditions and forecasts

of future economic performance when appropriate.

Loss-rate approach is based on the historical loss rates and expectations of future

The Company writes off potentially uncollectible accounts receivable against the allowance for credit losses if it is determined

that the amounts will not be collected.

As of March 31, 2025 and June 30, 2024, the Company recorded the allowance of credit loss of $ 62,087

and $ 54,066 , respectively.

Inventories, net

Inventories are stated at

the lower of cost or net realizable value, using the first-in, first out (FIFO) method.

Costs include the cost of pharmaceutical products

or solutions.

Any excess of the cost over the net realizable value of each item of inventories is recognized as a provision for diminution

in the value of inventories.

Net realizable value is estimated using selling price in the normal course of business less any costs to

complete and sell products.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

in Other entity

Company assesses its investment in ABL Wuhan and determines that no significant influence over investee existed, as defined in ASC 323-10-15-6,

and therefore accounts for the investment using the cost method of accounting.

Under the cost method of accounting, the investment is

measured at cost, adjusted for observable price changes and impairments, with changes recognized in net income.

The investment in other

entity that does not report net asset value is subject to qualitative assessment for indicators of impairments.

August 4, 2023, ABL Wuhan ceased to be the Company’s subsidiary and became the Company’s long-term investment.

As of December 31, 2024 and June 30, 2024, the Company’s investment in ABL Wuhan amounted to $ 15,741 and no impairment charges

was recorded.

and equipment

and equipment are stated at cost less accumulated depreciation.

The straight-line depreciation method is used to compute depreciation

over the estimated useful lives of the assets, as follows:

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

Investment in Other entity

The Company assesses its investment

in ABL Wuhan and determines that no significant influence over investee existed, as defined in ASC 323-10-15-6, and therefore accounts

for the investment using the cost method of accounting.

Under the cost method of accounting, the investment is measured at cost, adjusted

for observable price changes and impairments, with changes recognized in net income.

The investment in other entity that does not report

net asset value is subject to qualitative assessment for indicators of impairments.

On August 4, 2023, ABL

Wuhan ceased to be the Company’s subsidiary and became the Company’s long-term investment.

As of March 31, 2025 and June

30, 2024, the Company’s investment in ABL Wuhan amounted to $ 15,741 and no impairment charges was recorded.

Property and equipment

Property and equipment are

stated at cost less accumulated depreciation.

The straight-line depreciation method is used to compute depreciation over the estimated

useful lives of the assets, as follows:

Furniture and fixtures 7 years

1 unchanged sentence

Vehicles 5 years

Software 3 years

Leasehold improvement Lesser of the lease term or estimated useful lives of the assets

for maintenance and repairs, which do not materially extend the useful lives of the assets, are charged to expense as incurred.

for major renewals and betterments which substantially extend the useful life of assets are capitalized.

The cost and related accumulated

depreciation of assets retired or sold are removed from the respective accounts, and any gain or loss is recognized in other income or

expenses in the condensed consolidated statements of income (loss) and other comprehensive income (loss).

assets consist primarily of business license purchased from a third-party.

It grants the Company the right of selling and distributing

pharmaceutical products and solutions.

assets are stated at cost less accumulated amortization.

The license is amortized using the straight-line method over the estimated useful

economic life of 5 years.

account payables are derived from logistic services and forwarding service providers.

The balances arise from logistics services provider

are usually settled within 7 to 30 days.

HOLDING LIMITED

Expenditures for maintenance

and repairs, which do not materially extend the useful lives of the assets, are charged to expense as incurred.

Expenditures for major

renewals and betterments which substantially extend the useful life of assets are capitalized.

The cost and related accumulated depreciation

of assets retired or sold are removed from the respective accounts, and any gain or loss is recognized in other income or expenses in

the condensed consolidated statements of income (loss) and other comprehensive income (loss).

Intangible Assets, net

Intangible assets consist

primarily of business license purchased from a third-party.

It grants the Company the right of selling and distributing pharmaceutical

products and solutions.

Intangible assets are stated

at cost less accumulated amortization.

The license is amortized using the straight-line method over the estimated useful economic life

Accounts payable

The account payables are derived from logistics and forwarding service

providers and from the pharmaceutical products supplier.

Balances due to logistics service providers are typically settled within 7 to

30 days, while payables to pharmaceutical product suppliers are generally settled within 60 days.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

of long-lived asset

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Impairment of long-lived asset

Long-lived assets, including

10 unchanged sentences

the approach applied for its other long-lived assets.

No impairment charge was recognized for the three and six months ended December

No impairment charge was recognized for the three and nine months ended March

31, 2025 and 2024, respectively.

offering costs

to ASC 340-10-S99-1, incremental offering costs directly attributable to an offering of equity securities are deferred and would

be charged against the gross proceeds of the offering as a reduction of additional paid-in capital.

These costs include legal fees

related to the registration drafting and counsel, consulting fees related to the registration preparation, audit fees, SEC filing and

print related costs and exchange listing costs.

The deferred offering costs are offset against additional paid-in capital upon receipts

of the capital raised at IPO closing date.

Deferred offering costs

Pursuant to ASC 340-10-S99-1,

incremental offering costs directly attributable to an offering of equity securities are deferred and would be charged against the gross

proceeds of the offering as a reduction of additional paid-in capital.

These costs include legal fees related to the registration

drafting and counsel, consulting fees related to the registration preparation, audit fees, SEC filing and print related costs and exchange

listing costs.

The deferred offering costs are offset against additional paid-in capital upon receipts of the capital raised at IPO closing

Asset Acquisition

7 unchanged sentences

equations method and adjusted the assigned value of the non-monetary assets acquired to include the deferred tax liability.

Company evaluates the contracts it entered into to determine whether such contracts contain leases at inception.

A contract contains

a lease if the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange

for consideration.

At commencement, contracts containing a lease are further evaluated for classification as an operating or finance

lease where the Company is a lessee.

lease for which substantially all the benefits and risks incidental to ownership remain with the lessor is classified by the lease as

an operation lease.

Operating leases are included in the line items right-of-use (ROU) asset, lease liabilities, current, and lease

liabilities, non-current in the consolidated balance sheet.

ROU assets represent the Company’s right to use an underlying

asset for the lease term and lease liabilities represent its obligation to make lease payments arising from the lease.

For operating

leases, the Company measures its lease liabilities based on the present value of the total lease payments not yet paid discounted based

on the more readily determinable of the rate implicit in the lease or its incremental borrowing rate, which is the estimated rate the

Company would be required to pay for a collateralized borrowing equal to the total lease payments over the term of the lease.

uses its incremental borrowing rate based on the information available at lease commencement date in determining the present value of

lease payments.

The Company measures ROU assets based on the corresponding lease liability adjusted for payments made to the lessor at

or before the commencement date, and initial direct costs it incurs under the lease.

The Company begins recognizing lease expense when

the lessor makes the underlying asset available to the Company.

Lease expenses for lease payments are recognized on a straight-line basis

over the lease term.

leases with lease term less than one year (short-term leases), the Company has elected not to recognize a lease liability or ROU

asset on its consolidated balance sheet.

Instead, it recognizes the lease payments as expenses on a straight-line basis over the

Short-term lease costs are immaterial to its consolidated statements of operations and cash flows.

HOLDING LIMITED

The Company evaluates the

contracts it entered into to determine whether such contracts contain leases at inception.

A contract contains a lease if the contract

conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration.

commencement, contracts containing a lease are further evaluated for classification as an operating or finance lease where the Company

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

that transfer substantially all of the benefits and risks incidental to the ownership of assets are accounted for as finance leases as

if there was an acquisition of an asset and incurrence of an obligation at the inception of the lease.

Lease cost for finance leases

where the Company is the lessee includes the amortization of the ROU asset, which is amortized on a straight-line basis and recorded

to “Depreciation of right-of-use finance asset” and interest expense on the finance lease liability, which is calculated

using the interest method and recorded to “Interest expense”.

Finance lease ROU assets are amortized over the shorter of

their estimated useful lives or the terms of the respective leases.

If the Company is reasonably certain to exercise the option to purchase

the underlying asset at the end of lease term, the finance lease ROU assets are amortized to the end of useful life of the assets on

a straight-line basis.

Company adopted ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions.

value of financial instruments

“Fair Value Measurements” (ASC 820) and ASC 825, “Financial Instruments” (ASC 825), requires an

entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

It establishes

a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value.

instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the

fair value measurement.

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Operating Leases

A lease for which substantially

all the benefits and risks incidental to ownership remain with the lessor is classified by the lease as an operation lease.

leases are included in the line items right-of-use (ROU) asset, lease liabilities, current, and lease liabilities, non-current in

the consolidated balance sheet.

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease

liabilities represent its obligation to make lease payments arising from the lease.

For operating leases, the Company measures its lease

liabilities based on the present value of the total lease payments not yet paid discounted based on the more readily determinable of the

rate implicit in the lease or its incremental borrowing rate, which is the estimated rate the Company would be required to pay for a collateralized

borrowing equal to the total lease payments over the term of the lease.

The Company uses its incremental borrowing rate based on the information

available at lease commencement date in determining the present value of lease payments.

The Company measures ROU assets based on the

corresponding lease liability adjusted for payments made to the lessor at or before the commencement date, and initial direct costs it

incurs under the lease.

The Company begins recognizing lease expense when the lessor makes the underlying asset available to the Company.

Lease expenses for lease payments are recognized on a straight-line basis over the lease term.

For leases with lease term

less than one year (short-term leases), the Company has elected not to recognize a lease liability or ROU asset on its consolidated

balance sheet.

Instead, it recognizes the lease payments as expenses on a straight-line basis over the lease term.

Short-term lease

costs are immaterial to its consolidated statements of operations and cash flows.

Finance leases

Leases that transfer substantially

all of the benefits and risks incidental to the ownership of assets are accounted for as finance leases as if there was an acquisition

of an asset and incurrence of an obligation at the inception of the lease.

Lease cost for finance leases where the Company is the lessee

includes the amortization of the ROU asset, which is amortized on a straight-line basis and recorded to “Depreciation of right-of-use finance

asset” and interest expense on the finance lease liability, which is calculated using the interest method and recorded to “Interest

Finance lease ROU assets are amortized over the shorter of their estimated useful lives or the terms of the respective

If the Company is reasonably certain to exercise the option to purchase the underlying asset at the end of lease term, the finance

lease ROU assets are amortized to the end of useful life of the assets on a straight-line basis.

Related parties

The Company adopted ASC 850,

Related Party Disclosures, for the identification of related parties and disclosure of related party transactions.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

Fair value of financial instruments

ASC 820, “Fair

Value Measurements” (ASC 820) and ASC 825, “Financial Instruments” (ASC 825), requires an entity to maximize

the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

It establishes a fair value hierarchy

based on the level of independent, objective evidence surrounding the inputs used to measure fair value.

A financial instrument’s

categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

It prioritizes the inputs into three levels that may be used to measure fair value:

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 of the

fair value of the assets or liabilities.

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 of the fair value of the assets or liabilities.

The carrying value of cash

and cash equivalent, accounts receivable from third parties and related parties, amount due from related parties, due to shareholders,

other receivables, contract assets, loan receivable balance from a third party, accounts payable, other payables, dividend payable and

accrued expenses and other current liabilities approximate fair value due to their short-term nature.

For lease liabilities and loans

payable, their carrying value approximate the fair value at the year-end, as the interest rates used to discount the host contracts approximate

market rates.

The Company noted no transfers between levels during any of the periods presented.

The Company did not have any instruments

that were measured at fair value on a recurring nor non-recurring basis as of December 31, 2024 and June 30, 2024.

HOLDING LIMITED

other receivables, contract assets, loan receivable balance from a third party, accounts payable, convertible notes - current, loan to

a related party, other payables, dividend payable and accrued expenses and other current liabilities approximate fair value due to their

short-term nature.

For lease liabilities, loan payable to a related party, convertible notes and loans payable, their carrying value

approximate the fair value at the year-end, as the interest rates used to discount the host contracts approximate market rates.

noted no transfers between levels during any of the periods presented.

The Company did not have any instruments that were measured at

fair value on a recurring nor non-recurring basis as of March 31, 2025 and June 30, 2024.

Convertible notes

In accordance with ASC 470, Debt ("ASC 470") the Company

records its 7 % original issue discount secured convertible promissory notes (“Notes”) at the aggregate principal amount, less

The Company evaluated the loan portion of the Notes and the accompanying warrant under the guidance of ASC 470-20, “Debt

with Conversion and Other Options,” and ASC 815, “Derivatives and Hedging.” The Company determined that the warrant

met the criteria for equity classification under ASC 815-40.

Accordingly, the fair value of the warrant was recorded as a component of

additional paid-in capital and convertible debt instrument as a liability in accordance with ASC 470-20 on the issuance date.

debt is subsequently accounted for at amortized cost in accordance with the interest method described in ASC 835-30 (see Note 12).

Common stock warrants

The Company evaluates common

stock warrants under ASC 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity.

The Company assesses

whether common stock warrants are freestanding financial instruments and whether they meet the criteria to be classified in stockholders’

equity, or classified as a liability.

Where common stock warrants do not meet the conditions to be classified in equity, the Company assesses

whether they meet the definition of a liability under ASC 815.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

Company adopted ASC Topic 606 “Revenue from Contracts with Customers” and all subsequent ASUs that modified ASC 606.

The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to

customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

To achieve that core principle, the Company applies the following steps:

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Debt issuance costs

Direct and incremental costs

and original issue discounts and premiums incurred in connection with the issuance of long-term debt are deferred and amortized to interest

expense using the effective interest method or, if the amounts approximate the effective interest method, on a straight-line basis.

debt issuance costs are presented as a direct reduction of debt on the unaudited condensed consolidated balance sheets.

Approximately

$ 24,517 was amortized to interest expense during the three months ended March 31, 2025 .

Revenue recognition

The Company adopted ASC Topic

606 “Revenue from Contracts with Customers” and all subsequent ASUs that modified ASC 606.

The core principle of the

guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that

reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

To achieve that core principle,

the Company applies the following steps:

Identify the contract (s) with a customer

Identify the performance obligations in the contract

Determine the transaction price

Allocate the transaction price to the performance obligations in the contract

Recognize revenue when (or as) the entity satisfies a performance obligation

Company generates revenue from providing cross-border ocean and airfreight solutions.

No practical expedients were used when adoption

Revenue recognition policies are as follow:

from cross-border freights solutions

Company provides comprehensive services in the United States for customers to transport goods from overseas to the United States

and from the United States to overseas.

Operating under service contracts, for goods entering the United States, after the

goods arrive at a U.S.

seaports or airports, the Company offers customs clearance, container unloading, storage, unpacking, packing,

and transportation services to the locations specified by the customers.

For customers shipping goods overseas, the Company provides

cargo space arrangements, storage, packing, export customs clearance, and arranges transportation to seaports or airports for loading.

transaction price is determined based on the range of services provided and the volume of goods.

The Company considers these comprehensive

services as one performance obligation since these promises are not distinct within the context of the contract, and the bundle of integrated

services represents a combined output.

This performance obligation is satisfied over time as customers receive the benefits of these

services during the process of transporting goods from one location to another.

goods entering the United States, the Company determines that the performance period for revenue recognition is between the pickup

date and the date of completing delivery.

For customers shipping goods overseas with cargo space booking service, the Company determines

that the performance period for revenue recognition is between the container or cargo space confirmed date and the date of arrival at

For customers shipping goods overseas without cargo space booking service, the Company determines that the performance period

for revenue recognition is between pickup date and the date when the goods are departed from airport or port.

The performance period

may be estimated if the date of completing delivery or the departure date or arrival date has not occurred by the reporting date.

the performance period and the progress of the transportation as of the reporting date requires management’s estimation and judgement,

which may impact the timing of revenue recognition.

HOLDING LIMITED

performance obligations in the contract

Determine the

transaction price

transaction price to the performance obligations in the contract

Recognize revenue

when (or as) the entity satisfies a performance obligation

The Company generates revenue

from providing cross-border ocean and airfreight solutions and distribution of pharmaceutical products.

No practical expedients were

used when adoption ASC606.

Revenue recognition policies are as follows:

Revenue from cross-border freights

The Company provides comprehensive

services in the United States for customers to transport goods from overseas to the United States and from the United States

Operating under service contracts, for goods entering the United States, after the goods arrive at a U.S.

or airports, the Company offers customs clearance, container unloading, storage, unpacking, packing, and transportation services to the

locations specified by the customers.

For customers shipping goods overseas, the Company provides cargo space arrangements, storage, packing,

export customs clearance, and arranges transportation to seaports or airports for loading.

The transaction price is determined

based on the range of services provided and the volume of goods.

The Company considers these comprehensive services as one performance

obligation since these promises are not distinct within the context of the contract, and the bundle of integrated services represents

a combined output.

This performance obligation is satisfied over time as customers receive the benefits of these services during the process

of transporting goods from one location to another.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

recognition (cont.)

from distribution of pharmaceutical products

the three and six months ended December 31, 2024, the Company started to generate revenue from the distribution of pharmaceutical and

medical products.

The Company orders products from the manufacturer, receives and carries the product at a designated warehouse, and

delivers the product directly to its customers’ warehouses or designated locations.

Revenue is recognized when control of goods

is transferred to the customers upon goods delivered to the customers and acceptance by the customers.

and agent considerations

the Company’s transportation business, the Company utilizes independent contractors and third-party carriers and related party

carriers in the performances of some transportation services as and when needed.

GAAP requires us to evaluate, using a control

model, whether the Company itself promises to provide services to the customers (as a principal) or to arrange for services to be provided

by another party (as an agent).

Based on the Company’s evaluation using a control model, the Company determined that in all of

its major business activities, it serves as a principal rather than an agent within their revenue arrangements.

Revenue and the associated

purchased transportation costs are both reported on a gross basis within the unaudited condensed consolidated statements of income (loss)

and comprehensive income (loss).

the Company’s distribution of pharmaceutical products business, the Company determined that in all of its major business activities,

it serves as a principal rather than an agent within their revenue arrangements.

Disaggregation

Company disaggregates its revenue from types of services providing and the customer geographic of its customers, as the Company believes

it best depicts how the nature, amount, timing and uncertainty of the revenue and cash flows are affected by economic factors.

Company’s disaggregation of revenues for three months ended December 31, 2024 and 2023 is disclosed as below:

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Revenue recognition (cont.)

Revenue from cross-border freights

solutions (cont.)

For goods entering the United States,

the Company determines that the performance period for revenue recognition is between the pickup date and the date of completing delivery.

For customers shipping goods overseas with cargo space booking service, the Company determines that the performance period for revenue

recognition is between the container or cargo space confirmed date and the date of arrival at destination.

For customers shipping goods

overseas without cargo space booking service, the Company determines that the performance period for revenue recognition is between pickup

date and the date when the goods depart from airport or port.

The performance period may be estimated if the date of completing delivery

or the departure date or arrival date has not occurred by the reporting date.

Determining the performance period and the progress of the

transportation as of the reporting date requires management’s estimation and judgement, which may impact the timing of revenue recognition.

Revenue from distribution of pharmaceutical

During the nine months ended March 31, 2025, the Company started to

generate revenue from the distribution of pharmaceutical and medical products.

The Company orders products from the manufacturer, receives

and carries the product at a designated warehouse, and delivers the product directly to its customers’ warehouses or designated

Revenue is recognized when control of goods is transferred to the customers upon goods delivered to the customers and acceptance

by the customers.

Principal and agent considerations

In the Company’s transportation

business, the Company utilizes independent contractors and third-party carriers and related party carriers in the performances of

some transportation services as and when needed.

GAAP requires us to evaluate, using a control model, whether the Company itself

promises to provide services to the customers (as a principal) or to arrange for services to be provided by another party (as an agent).

Based on the Company’s evaluation using a control model, the Company determined that in all of its major business activities, it

serves as a principal rather than an agent within their revenue arrangements.

Revenue and the associated purchased transportation costs

are both reported on a gross basis within the unaudited condensed consolidated statements of income (loss) and comprehensive income (loss).

In the Company’s distribution

of pharmaceutical products business, the Company determined that in all of its major business activities, it serves as a principal rather

than an agent within their revenue arrangements.

Disaggregation of revenues

The Company disaggregates

its revenue from types of services providing and the customer geographic of its customers, as the Company believes it best depicts how

the nature, amount, timing and uncertainty of the revenue and cash flows are affected by economic factors.

The Company’s disaggregation

of revenues for three months ended March 31, 2025 and 2024 is disclosed as below:

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Revenue recognition (cont.)

Disaggregation of revenues (cont.)

By service/product type

9 unchanged sentences

Total revenue

HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

Disaggregation

of revenues (cont.)

customer geographic location

By customer geographic location

For the three months ended

2 unchanged sentences

Total revenue

Company’s disaggregation of revenues for six months ended December 31, 2024 and 2023 is disclosed as below:

For the six months ended

The Company’s disaggregation

of revenues for the nine months ended March 31, 2025 and 2024 is disclosed as below:

By service type

For the nine months ended

Cross-border ocean freights solutions

2 unchanged sentences

Total revenue

For the six months ended

For the nine months ended

Timing of revenue recognition:

2 unchanged sentences

Total revenue

customer geographic location

For the six months ended

By customer geographic location

For the nine months ended

Asia-based customers

1 unchanged sentence

Total revenue

assets represent estimated amounts for which the Company has the right to consideration for the services provided while a delivery is

still in-transit and has not yet invoiced the customer.

Upon completion of the performance obligations, which can vary in duration based

upon the method of transport and billing the customer, these amounts become classified within accounts receivable.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Contract assets

Contract assets represent

estimated amounts for which the Company has the right to consideration for the services provided while a delivery is still in-transit

and has not yet invoiced the customer.

Upon completion of the performance obligations, which can vary in duration based upon the method

of transport and billing the customer, these amounts become classified within accounts receivable.

Contract liabilities

Contract liabilities represent

estimated advances received from customers.

The contract liabilities are reported in a net position on a customer-by-customer basis at

the end of each reporting period.

Contract liabilities are recognized when the Company receives prepayment from customers resulting from

purchase order.

Contract liabilities will be recognized as revenue when the products are delivered.

As of March 31, 2025, the Company

recorded contract liabilities of $ 42,168 , which will be recognized as revenue upon delivery of the products sold.

For the nine months

ended March 31, 2025, the amounts transferred from contract liabilities to revenue at the beginning of the fiscal period were nil .

Cost of revenues

In the Company’s transportation

business, cost of revenue primarily consists of the transportation and delivery costs, warehouse service charges, custom declaration

and terminal charges, freight arrangement charges and other overhead cost allocation, which includes operating and financing lease-related costs,

business, cost of revenue primarily consists of the transportation and delivery costs, warehouse service charges, custom declaration and

terminal charges, freight arrangement charges and other overhead cost allocation, which includes operating and financing lease-related costs,

the depreciation expenses of property and equipment, and others miscellaneous items.

the Company’s distribution of pharmaceutical products business, cost of revenues primarily consists of cost of products, freights

arrangement charges and other overhead cost allocation.

HOLDING LIMITED

In the Company’s distribution

of pharmaceutical products business, cost of revenues primarily consists of cost of products, freights arrangement charges and other overhead

cost allocation.

Selling expenses

Selling expenses primarily include salaries expense and traveling expense

of sales team engaged in developing potential customers and maintaining customer relationships and transportation cost for selling pharmaceutical

General and administrative expenses

General and administrative

expenses primarily include salaries and staff benefits, repair and maintenance expense, depreciation on property and equipment, lease

expenses, travelling and entertainment, bank charges, legal and professional fees, insurance expenses and other office expenses.

401(k) benefit plan

401(k) benefit plan covers

substantially all employees and allows voluntary employee contributions up to the annually adjusted Inland Revenue Service (“IRS”)

dollar limit.

These voluntary contributions are matched equal to 100 % of the first 3 % of the employee’s compensation contributed

and 50 % of contributions exceeding 3 % of eligible compensation, not to exceed 5 % of the total eligible compensation.

The employees’

voluntary contributions and the Company’s matching contributions are 100 % vested immediately.

The Company adopted the 401(k) benefit

plan from April 2022.

The expense related to matching employees’ contributions was $ 7,960 and $ 7,320 for the three months ended

March 31, 2025 and 2024, respectively.

The expense related to matching employees’ contributions was $ 23,838 and $ 21,372 for the

nine months ended March 31, 2025 and 2024, respectively.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

and administrative expenses

and administrative expenses primarily include salaries and staff benefits, repair and maintenance expense, depreciation on property and

equipment, lease expenses, travelling and entertainment, bank charges, legal and professional fees, insurance expenses and other office

401(k) benefit

plan covers substantially all employees and allows voluntary employee contributions up to the annually adjusted Inland Revenue Service

(“IRS”) dollar limit.

These voluntary contributions are matched equal to 100 % of the first 3 % of the employee’s compensation

contributed and 50 % of contributions exceeding 3 % of eligible compensation, not to exceed 5 % of the total eligible compensation.

employees’ voluntary contributions and the Company’s matching contributions are 100 % vested immediately.

The Company adopted

the 401(k) benefit plan from April 2022.

The expense related to matching employees’ contributions was $ 6,896 and $ 7,456

for the three months ended December 31, 2024 and 2023, respectively.

The expense related to matching employees’ contributions was

$ 15,878 and $ 14,052 for the six months ended December 31, 2024 and 2023, respectively.

defined contribution plan

Full-time employees of the Company in the PRC participate in a government-mandated

multi-employer defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance, employee housing

fund and other welfare benefits are provided to them.

Chinese labor regulations require that the Company make contributions to the government

for these benefits based on government prescribed percentage of the employee’s salaries.

The Company has no legal obligation for

the benefits beyond the contributions.

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Employee defined contribution plan

Full-time employees of the

Company in the PRC participate in a government-mandated multi-employer defined contribution plan pursuant to which certain pension benefits,

medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to them.

Chinese labor regulations

require that the Company make contributions to the government for these benefits based on government prescribed percentage of the employee’s

The Company has no legal obligation for the benefits beyond the contributions.

The total amount was expensed as incurred.

For the three and six months ended December 31, 2024

and 2023, employee welfare contribution expenses amounted to approximately $ 11,225 , $ nil , $ 11,225 and $ nil , respectively.

added tax (“VAT”)

represents the invoiced value of goods and service, net of VAT.

The VAT is based on gross sales price and VAT rates range up to 13 %,

depending on the type of products sold or services provided.

Entities that are VAT general taxpayers are allowed to offset qualified

input VAT paid to suppliers against their output VAT liabilities.

Net VAT balance between input VAT and output VAT is recorded in taxes

All of the VAT returns filed by the Company’s subsidiaries in PRC remain subject to examination by the tax authorities

for five years from the date of filing.

Company subleased portion of its offices area, warehouse and parking lots to third parties and related parties.

The Company recognizes

rental income over the sublease period.

For the three months ended December 31, 2024 and 2023, the Company recognized rental income amounted

to $ 87,227 and $ 30,300 , respectively.

For the six months ended December 31, 2024 and 2023, the Company recognized rental income amounted

to $ 188,294 and $ 80,683 , respectively.

HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

the Reorganization, the Company has elected to be taxed as an S Corporation for federal and state income tax purposes.

As an S Corporation,

the Company is not subject to federal income tax and state tax in Illinois.

However, Illinois allows subchapter S corporations to elect

to pay the Pass-through Entity (PTE) tax at entity level for tax years ending on or after December 31, 2021 and beginning

prior to January 1, 2026.

The PTE tax rate is equal to 4.95 % of the taxpayer’s net income for the taxation year.

The S corporation

making the election is liable for paying the PTE tax, and the shareholders will receive credit for the amount of PTE tax credit paid

but shall be liable to pay any remaining tax based on their share of the pass-through entity’s income and credits.

also taxes 1.5 % replacement tax on S corporation’s net taxable income and franchise tax based on the corporation’s paid-in-capital for

the 12 months prior to the annual report filing date.

the three months ended March 31, 2025 and 2024, employee welfare contribution expenses amounted to approximately $ 11,456 and nil , respectively.

For the nine months ended March 31, 2025 and 2024, employee welfare contribution expenses amounted to approximately $$ 22,681 and nil ,

respectively.

Value added tax (“VAT”)

Revenue represents the invoiced

value of goods and service, net of VAT.

The VAT is based on gross sales price and VAT rates range up to 13 %, depending on the type

of products sold or services provided.

Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers

against their output VAT liabilities.

Net VAT balance between input VAT and output VAT is recorded in taxes payable.

All of the VAT returns

filed by the Company’s subsidiaries in PRC remain subject to examination by the tax authorities for five years from the

date of filing.

Rental income

The Company subleased portion

of its offices area, warehouse and parking lots to third parties and related parties.

The Company recognizes rental income over the sublease

For the three months ended March 31, 2025 and 2024, the Company recognized rental income amounted to $ 95,279 and $ 99,004 , respectively.

For the nine months ended March 31, 2025 and 2024, the Company recognized rental income amounted to $ 283,573 and $ 179,687 , respectively.

Before the Reorganization,

the Company has elected to be taxed as an S Corporation for federal and state income tax purposes.

As an S Corporation, the Company is

not subject to federal income tax and state tax in Illinois.

However, Illinois allows subchapter S corporations to elect to pay the Pass-through Entity

(PTE) tax at entity level for tax years ending on or after December 31, 2021 and beginning prior to January 1, 2026.

PTE tax rate is equal to 4.95 % of the taxpayer’s net income for the taxation year.

The S corporation making the election is liable

for paying the PTE tax, and the shareholders will receive credit for the amount of PTE tax credit paid but shall be liable to pay any

remaining tax based on their share of the pass-through entity’s income and credits.

Illinois also taxes 1.5 % replacement tax

on S corporation’s net taxable income and franchise tax based on the corporation’s paid-in-capital for the 12 months

prior to the annual report filing date.

The franchise tax is not applicable for the Company.

After the Reorganization,

the Company is subjected to U.S.

After the Reorganization, the Company is

subjected to U.S.

federal income tax at 21 % and the 7.0 % state tax and the 2.5 % replacement tax in the state of Illinois.

Company’s PRC subsidiary is governed by the income tax laws of the PRC and the income tax provision in respect to operations in

the PRC is calculated at the applicable tax rates on the taxable income for the periods based on existing legislation, interpretations

and practices in respect thereof.

Under the Enterprise Income Tax Laws of the PRC (the “EIT Laws”), domestic enterprises

and Foreign Investment Enterprises (the “FIE”) are usually subject to a unified 25 % enterprise income tax rate while preferential

tax rates, tax holidays and even tax exemption may be granted on case-by-case basis.

tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities.

tax assets and liabilities are the expected future tax amounts for the temporary differences between carrying amounts and tax bases of

assets and liabilities computed using enacted tax rates.

A valuation allowance, if needed, reduces deferred tax assets to the amount

expected to be realized.

Company accounts for uncertain tax positions in accordance with FASB ASC Topic No.

The Company’s PRC subsidiary

is governed by the income tax laws of the PRC and the income tax provision in respect to operations in the PRC is calculated at the applicable

tax rates on the taxable income for the periods based on existing legislation, interpretations and practices in respect thereof.

the Enterprise Income Tax Laws of the PRC (the “EIT Laws”), domestic enterprises and Foreign Investment Enterprises (the “FIE”)

are usually subject to a unified 25 % enterprise income tax rate while preferential tax rates, tax holidays and even tax exemption may

be granted on case-by-case basis.

Income tax expense is the

total of the current year income tax due or refundable and the change in deferred tax assets and liabilities.

Deferred tax assets and

liabilities are the expected future tax amounts for the temporary differences between carrying amounts and tax bases of assets and liabilities

computed using enacted tax rates.

A valuation allowance, if needed, reduces deferred tax assets to the amount expected to be realized.

The Company accounts for uncertain

tax positions in accordance with FASB ASC Topic No.

740, Accounting for Uncertainty in Income Taxes.

tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in

a tax examination, with a tax examination being presumed to occur.

The amount recognized is the largest amount of tax benefit that is

greater than 50% likely of being realized on examination.

For tax positions not meeting the “more likely than not” test,

no tax benefit is recorded.

As of December 31, 2024 and June 30, 2024, the Company did not have a liability for unrecognized tax

It is the Company’s policy to includes penalties and interest expense related to income taxes as a component of other

expense and interest expense, respectively, as necessary.

The Company’s historical tax years will remain open for examination by

the local authorities until the statute of limitations has passed.

Company’s PRC subsidiaries are required to allocate at least 10% of their after-tax profit to the general reserve in accordance

with the PRC accounting standards and regulations.

The allocation to the general reserve will cease if such reserve has reached to 50%

of the registered capital of respective company.

These reserves can only be used for specific purposes and are not transferable to the

Company in form of loans, advances, or cash dividends.

There is no such regulation of providing statutory reserve in United States.

HOLDING LIMITED

A tax position is recognized as a

benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination

being presumed to occur.

The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized

on examination.

For tax positions not meeting the “more likely than not” test, no tax benefit is recorded.

As of March 31,

2025 and June 30, 2024, the Company did not have a liability for unrecognized tax benefits.

It is the Company’s policy to includes

penalties and interest expense related to income taxes as a component of other expense and interest expense, respectively, as necessary.

The Company’s historical tax years will remain open for examination by the local authorities until the statute of limitations has

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

Comprehensive

income (loss)

Comprehensive

income (loss) consists of two components, net income (loss) and other comprehensive income (loss).

Other comprehensive income (loss)

refers to revenue, expenses, gains and losses that under GAAP are recorded as an element of equity but are excluded from net income.

Other comprehensive income (loss) consists of a foreign currency translation adjustment resulting from the Company not using the U.S.

dollar as its functional currencies.

and diluted earnings (loss) per share

Company computes earnings per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”).

ASC 260 requires companies with complex capital structures to present basic and diluted EPS.

Basic EPS is measured as net income

(loss) divided by the weighted average common shares outstanding for the period.

Diluted EPS presents the dilutive effect on a per share

basis of potential common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning

of the periods presented, or issuance date, if later.

Potential common shares that have an anti-dilutive effect (i.e., those that

increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS.

currency transactions

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Statutory reserves

The Company’s PRC subsidiaries

are required to allocate at least 10 % of their after-tax profit to the general reserve in accordance with the PRC accounting standards

and regulations.

The allocation to the general reserve will cease if such reserve has reached to 50 % of the registered capital of respective

These reserves can only be used for specific purposes and are not transferable to the Company in form of loans, advances, or

cash dividends.

There is no such regulation of providing statutory reserve in United States.

Comprehensive income (loss)

consists of two components, net income (loss) and other comprehensive income (loss).

Other comprehensive income (loss) refers to revenue,

expenses, gains and losses that under GAAP are recorded as an element of equity but are excluded from net income.

Other comprehensive

income (loss) consists of a foreign currency translation adjustment resulting from the Company not using the U.S.

dollar as its functional

Basic and diluted earnings (loss) per share

The Company computes earnings

per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”).

requires companies with complex capital structures to present basic and diluted EPS.

Basic EPS is measured as net income (loss) divided

by the weighted average common shares outstanding for the period.

Diluted EPS presents the dilutive effect on a per share basis of potential

common shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented,

or issuance date, if later.

Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share

or decrease loss per share) are excluded from the calculation of diluted EPS.

Foreign currency transactions

Our reporting currency is

3 unchanged sentences

Sichuan and Hupan Pharmaceutical are remeasured in accordance with ASC 830.

For the period ended December 31, 2024, assets and liabilities

For the period ended March 31, 2025, assets and liabilities

of Lakeside Sichuan and Hupan Pharmaceutical are translated into U.S.

2 unchanged sentences

The resulting translation adjustment is included in accumulated other comprehensive loss.

following table outlines the currency exchange rates that were used in creating the consolidated financial statements in this report:

The following table outlines

the currency exchange rates that were used in creating the condensed consolidated financial statements in this report:

Balance sheet items, except for equity accounts

2 unchanged sentences

US$ 1 =RMB 7.2080

and contingencies

the normal course of business, the Company is subject to contingencies, such as legal proceedings and claims arising out of its business,

which cover a wide range of matters.

Liabilities for contingencies are recorded when it is probable that a liability has been incurred

and the amount of the assessment can be reasonably estimated.

the assessment of a contingency indicates that it is probable that a material loss is incurred and the amount of the liability can be

estimated, then the estimated liability is accrued in the Company’s financial statements.

If the assessment indicates that a potentially

material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the

contingency liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed.

contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee

would be disclosed.

HOLDING LIMITED

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

Concentrations

Concentration

of credit risk

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Commitments and contingencies

In the normal course of business,

the Company is subject to contingencies, such as legal proceedings and claims arising out of its business, which cover a wide range of

Liabilities for contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment

can be reasonably estimated.

If the assessment of a contingency

indicates that it is probable that a material loss is incurred and the amount of the liability can be estimated, then the estimated liability

is accrued in the Company’s financial statements.

If the assessment indicates that a potentially material loss contingency is not

probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingency liability, together with

an estimate of the range of possible loss, if determinable and material, would be disclosed.

Loss contingencies considered

remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed.

Concentrations and risks

Concentration of credit risk

The Company estimates credit

2 unchanged sentences

Assets that potentially subject the Company to significant concentration

of credit risk primarily consist of cash and cash equivalents, accounts receivable, contract assets, other receivable, loan receivable

balance from a third party and amounts due from related parties.

The Company has designed their credit policies with an objective to minimize

their exposure to credit risk.

of credit risk primarily consist of cash, accounts receivable, contract assets, other receivable, loan receivable balance from a third

party and amounts due from related parties.

The Company has designed their credit policies with an objective to minimize their exposure

to credit risk.

The maximum exposure of such

2 unchanged sentences

China, where there is a RMB 500,000 deposit insurance limit for a legal entity’s aggregated balance at each bank.

As of December

31, 2024 and June 30, 2024, one bank account exceeded the insured limit.

As of March 31,

2025 and June 30, 2024, three bank account exceeded the insured limit.

To limit the exposure to credit risk relating to deposits, the

Company primarily places cash deposits with large financial institutions in the mainland China.

The Company also has the

bank accounts at financial institutions in the United States, where there is $ 250,000 standard deposit insurance coverage limit

per depositor, per FDIC-insured bank and per ownership category.

As of December 31, 2024 and June 30, 2024, no bank balance

exceeded the insured limit.

To limit the exposure to credit risk relating to deposits, the Company primarily places cash deposits

with large financial institutions in the United States.

Company has adopted a credit policy of dealing with creditworthy counterparties to mitigate the credit risk from defaults.

The management

team conducts credit evaluations of its customers, and generally does not require collateral or other security from them.

establishes an accounting policy to provide for allowance for credit loss based on the individual customer’s financial condition,

credit history, and the future economic conditions.

Due from related parties’ balances and loan receivable balance from a third

party are monitored on an ongoing basis with the result that the Company’s exposure to impairment is not significant.

As of December

31, 2024 and June 30, 2024, none of the Company’s due from related parties and loan receivable balance from a third party are impaired.

exchange risk

subsidiary in PRC has functional currency in RMB.

PRC subsidiaries’ expense transactions are denominated in RMB and their assets

and liabilities are denominated in RMB.

RMB is not freely convertible into foreign currencies.

The value of the Chinese Yuan against

dollar is affected by the changes in China and United States economic conditions.

We do not believe that we currently

have any significant direct foreign exchange risk and have not used any derivative financial instruments to hedge exposure to such risk.

Also, considering the volume of its business, the impact of foreign exchange risk is limited.

HOLDING LIMITED

The Company also has the bank

accounts at financial institutions in the United States, where there is $ 250,000 standard deposit insurance coverage limit per depositor,

per FDIC-insured bank and per ownership category.

As of March 31, 2025 and June 30, 2024, no bank balance exceeded the insured limit.

To limit the exposure to credit risk relating to deposits, the Company primarily places cash deposits with large financial institutions

in the United States.

The Company has adopted a

credit policy of dealing with creditworthy counterparties to mitigate the credit risk from defaults.

The management team conducts credit

evaluations of its customers, and generally does not require collateral or other security from them.

The Company establishes an accounting

policy to provide for allowance for credit loss based on the individual customer’s financial condition, credit history, and the

future economic conditions.

Due from related parties’ balances and loan receivable balance from a third party are monitored on an

ongoing basis with the result that the Company’s exposure to impairment is not significant.

As of March 31, 2025 and June 30, 2024,

none of the Company’s due from related parties and loan receivable balance from a third party are impaired.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont.)

Concentrations

and risks (cont.)

rate risk is the risk that future cash flows will fluctuate as a result of changes in market interest rates.

Our exposure to interest

rate risk primarily relates to the interest rates from our lessors and our private lenders.

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Concentrations and risks (cont.)

Foreign exchange risk

Our subsidiaries in PRC have

functional currency in RMB.

PRC subsidiaries’ expense transactions are denominated in RMB and their assets and liabilities are denominated

RMB is not freely convertible into foreign currencies.

The value of the Chinese Yuan against the U.S.

dollar is affected

by the changes in China and United States economic conditions.

We do not believe that we currently have any significant direct foreign

exchange risk and have not used any derivative financial instruments to hedge exposure to such risk.

Also, considering the volume of its

business, the impact of foreign exchange risk is limited.

Interest rate risk

The interest rate risk is the risk that future cash flows will fluctuate

as a result of changes in market interest rates.

Our exposure to interest rate risk primarily relates to the interest rates from our lessors

and our private lenders.

The shareholder loans bear no interest.

have not been exposed to material risks due to the fact that our leasing obligations’ interest rates and private loan’s interest

are fixed at commence date of the leases and loans and we have not used any derivative financial instruments to manage our interest risk

However, we cannot provide assurance that we will not be exposed to material risks due to changes in market interest rate in

risk arises through the excess of financial obligations over available financial assets due at any point in time.

Our objective in managing

liquidity risk is to maintain sufficient readily available reserves in order to meet our liquidity requirements at any point in time.

The Company monitors and analyze its cash flow position, its ability to generate sufficient revenue sources in the future and its operating

and capital expenditure commitments.

The Company is historically funded the working capital needs primarily from operations, loans, as

well as shareholder advances to the Company.

The Company will use the capital from its offering closed in July 2024 to fund the further

working capital needs.

accounting pronouncements

Company considers the applicability and impact of all accounting standards updates (“ASUs”).

Management periodically reviews

new accounting standards that are issued.

November 2023, the FASB issued ASU No.

We have not been exposed to material risks due to the fact that our leasing

obligations’ interest rates and private loan’s interest are fixed at commence date of the leases and loans and we have not

used any derivative financial instruments to manage our interest risk exposure.

However, we cannot provide assurance that we will not

be exposed to material risks due to changes in market interest rate in the future.

Liquidity risk

Liquidity risk arises through

the excess of financial obligations over available financial assets due at any point in time.

Our objective in managing liquidity risk

is to maintain sufficient readily available reserves in order to meet our liquidity requirements at any point in time.

The Company monitors

and analyzes its cash flow position, its ability to generate sufficient revenue sources in the future and its operating and capital expenditure

The Company typically funds the working capital needs primarily from operations, loans, as well as shareholder advances to

Recent accounting pronouncements

The Company considers the

applicability and impact of all accounting standards updates (“ASUs”).

Management periodically reviews new accounting standards

that are issued.

In November 2023, the FASB

issued ASU No.

2023-07, “Improvements to Reportable Segment Disclosures” (Topic 280).

This ASU updates

reportable segment disclosure requirements by requiring disclosures of significant reportable segment expenses that are regularly provided

to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of a segment’s profit or loss.

This ASU also requires disclosure of the title and position of the individual identified as the CODM and an explanation of how the CODM

uses the reported measures of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources.

The ASU is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December

Adoption of the ASU should be applied retrospectively to all prior periods presented in the financial statements.

Early adoption

is also permitted.

This ASU updates reportable segment

disclosure requirements by requiring disclosures of significant reportable segment expenses that are regularly provided to the Chief Operating

Decision Maker (“CODM”) and included within each reported measure of a segment’s profit or loss.

This ASU also requires

disclosure of the title and position of the individual identified as the CODM and an explanation of how the CODM uses the reported measures

of a segment’s profit or loss in assessing segment performance and deciding how to allocate resources.

The ASU is effective for

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

of the ASU should be applied retrospectively to all prior periods presented in the financial statements.

Early adoption is also permitted.

This ASU will likely result in us including the additional required disclosures when adopted.

Management is currently

evaluating the provisions of this ASU and expect to adopt them for the year ending June 30, 2025.

December 2023, the FASB issued ASU No.

2023-09, “Improvements to Income Tax Disclosures” (Topic 740).

The ASU requires disaggregated

information about a reporting entity’s effective tax rate reconciliation as well as additional information on income tax paid.

The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024.

Early adoption is also permitted for

annual financial statements that have not yet been issued or made available for issuance.

This ASU will likely result in the required

additional disclosures being included in the Company’s consolidated financial statements, once adopted.

Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material

effect on the Company’s unaudited consolidated balance sheets, statements of income (loss) and comprehensive income (loss) and

statements of cash flows.

HOLDING LIMITED

Management is currently evaluating the provisions

of this ASU and expect to adopt them for the year ending June 30, 2025.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

3 — ACCOUNTS RECEIVABLE, NET

receivable, net consists of the following:

NOTE 2 — SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES (cont.)

Recent accounting pronouncements (cont.)

In December 2023, the FASB

issued ASU No.

2023-09, “Improvements to Income Tax Disclosures” (Topic 740).

The ASU requires disaggregated information about

a reporting entity’s effective tax rate reconciliation as well as additional information on income tax paid.

The ASU is effective

on a prospective basis for annual periods beginning after December 15, 2024.

Early adoption is also permitted for annual financial statements

that have not yet been issued or made available for issuance.

This ASU will likely result in the required additional disclosures being

included in the Company’s condensed consolidated financial statements, once adopted.

The Company does not believe other recently issued but not yet effective

accounting standards, if currently adopted, would have a material effect on the Company’s unaudited condensed consolidated balance

sheets, statements of income (loss) and comprehensive income (loss) and statements of cash flows.

NOTE 3 — ACCOUNTS RECEIVABLE, NET

Accounts receivable, net consists of the following:

Accounts receivable – third-party customers

5 unchanged sentences

Approximately $ 0.2 million

or 78.3 % of the accounts receivable balance from related party customers has been collected as of the report date.

or 69.7 % of the accounts receivable from related party customers have been collected as of the report date.

Approximately $ 1.1 million

or 70.8 % of the accounts receivable balance from third party customers has been collected as of the report date.

The movement of allowance for credit loss for the six months ended

December 31, 2024 and the year ended June 30, 2024 is as follows:

or 78.3 % of the accounts receivable from third party customers have been collected as of the report date.

The movement of allowance

for credit loss for the nine months ended March 31, 2025 and the year ended June 30, 2024 is as follows:

Beginning balance

1 unchanged sentence

Ending balance

The Company recorded reversal

allowance for credit loss of $ 10,881 and $ 2,531 for the three months ended December 31, 2024 and 2023, respectively.

The Company recorded

addition of allowance for credit loss of $ 1,956 and $ 49,591 for the six months ended December 31, 2024 and 2023, respectively.

4 — INVENTORIES, NET

net consists of the following:

The Company recorded addition

of allowance for credit loss of $ 6,065 and reversal of allowance for credit loss of $ 27,393 for the three months ended March 31, 2025

and 2024, respectively.

The Company recorded addition of allowance for credit loss of $ 8,021 and $ 22,198 for the nine months ended March

31, 2025 and 2024, respectively.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 — INVENTORIES, NET

Inventories, net consists of the following:

Finished goods

1 unchanged sentence

Inventories, net

HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5 — LOAN TO A THIRD PARTY

On October 8, 2024, the Company

entered into a loan agreement with a third party for a principal amount up to $ 2 million at a fixed interest rate of 4.35 % per annum with

a maturity date of twelve months.

There is no pledge and guarantee from the third party and the loan is on demand and can be called by

The loan balance was $ 686,697 and $ nil as of December 31, 2024 and June 30, 2024, respectively, and interest income

receivable from the third party as of December 31, 2024 and 2023 are nil and nil , respectively.

6 — PROPERTY AND EQUIPMENT, NET

and equipment, net consists of the following:

On October 8, 2024, the Company entered into a loan agreement with

a third party for a principal amount up to $ 2 million at a fixed interest rate of 4.35 % per annum with a maturity date of twelve months.

There is no pledge and guarantee from the third party and the loan is on demand and can be called by the Company.

The loan balance was

$ 573,546 , including interest income receivable of $ 11,645 , as of March 31, 2025.

NOTE 6 — PROPERTY AND EQUIPMENT, NET

Property and equipment, net consists of the following:

Furniture and Fixtures

4 unchanged sentences

Depreciation expense recorded

in general and administrative expense was $ 32,809 and $ 17,995 for the three months ended December 31, 2024 and 2023, respectively.

Depreciation expense recorded in cost of revenue was $ 18,164 and $ 18,163 for the three months ended December 31, 2024 and 2023, respectively.

in general and administrative expense was $ 35,609 and $ 17,995 for the three months ended March 31, 2025 and 2024, respectively.

expense recorded in cost of revenue was $ 26,113 and $ 18,165 for the three months ended March 31, 2025 and 2024, respectively.

Depreciation expense recorded

in general and administrative expense was $ 50,804 and $ 35,991 for the six months ended December 31, 2024 and 2023, respectively.

Depreciation expense recorded in cost of revenue was $ 36,328 and $ 36,328 for the six months ended December 31, 2024 and 2023, respectively.

in general and administrative expense was $ 86,413 and $ 53,985 for the nine months ended March 31, 2025 and 2024, respectively.

expense recorded in cost of revenue was $ 62,441 and $ 54,493 for the nine months ended March 31, 2025 and 2024, respectively.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7 — INTANGIBLE ASSETS, NET

intangible assets consists of the following:

Net intangible assets consists of the following:

accumulated amortization

Intangible asset, net

On November 5, 2024, the Company purchased a license of pharmaceutical

distribution in Mainland China through its acquisition of 100 % equity interest in Hupan Pharmaceutical.

The Company recognized the distribution

license as an intangible asset of $ 418,867 based on the assessment of fair value at the purchase date (see Not 18), adjusted by deferred

taxes recorded on temporary book/tax differences in an asset acquisition using the simultaneous equations method.

The transaction was

closed on November 21, 2024.

No impairment and amortization expense recognised for the three and six months ended December 31, 2024 and

2023, respectively.

HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Company has multiple lease agreements for warehouses, warehouse machinery and equipment and offices.

The Company’s lease agreements

do not contain any material residual value guarantees or material restrictive covenants.

As of December 31, 2024 and

June 30, 2024, balance of lease liabilities was $ 4,543,205 and $ 3,693,211 , respectively.

On November 5, 2024, the Company

purchased a license of pharmaceutical distribution in Mainland China through its acquisition of 100 % equity interest in Hupan Pharmaceutical.

The Company recognized the distribution license as an intangible asset of $ 418,867 based on the assessment of fair value at the purchase

date (see Not 21), adjusted by deferred taxes recorded on temporary book/tax differences in an asset acquisition using the simultaneous

equations method.

The transaction was closed on November 21, 2024.

No impairment expense was recognised for the three and nine months

ended March 31, 2025 and 2024, respectively.

Amortization expense of $ 32,056 and $ 32,056 was recognised for the three and nine months

ended March 31, 2025, respectively.

NOTE 8 — LEASES

The Company has multiple lease

agreements for warehouses, warehouse machinery and equipment and offices.

The Company’s lease agreements do not contain any material

residual value guarantees or material restrictive covenants.

As of March 31, 2025 and June

30, 2024, balance of lease liabilities was $ 4,205,176 and $ 3,693,211 , respectively.

The Company recognized additional operating lease

liabilities of $ 849,994 as result of entering into three new operating lease agreements for the six months ended December 31, 2024.

liabilities of $ 511,965 as result of entering into three new operating lease agreements for the nine months ended March 31, 2025.

ROU asset was recognized at the discount rate of 10.25 % for one lease with a lease term of 1.6 years in the U.S., 4.42 % for another lease

1 unchanged sentence

on the commencement date.

As of December 31, 2024,

the Company recognized additional finance lease liabilities of $ 74,038 as result of entering into two new finance lease agreements for

the six months ended December 31, 2024.

The ROU asset was recognized at the discount rate of 9.75 % and 10.75 % for both two leases with

a lease term of 5 years in the U.S., resulting in a total of $ 89,003 on the commencement date.

operating lease expenses on offices, warehouses, and warehouse equipment for the three months ended December 31, 2024 and 2023 were

As of March 31, 2025, the

Company recognized additional finance lease liabilities of $ 66,189 as result of entering into two new finance lease agreements for the

nine months ended March 31, 2025.

The ROU asset was recognized at the discount rate of 9.75 % and 10.75 % for both two leases with a lease

term of 5 years in the U.S., resulting in a total of $ 89,003 on the commencement date.

Total operating lease expenses

on offices, warehouses, and warehouse equipment for the three months ended March 31, 2025 and 2024 were $ 526,685 and $ 219,571 , respectively.

Total operating lease expenses on offices, warehouses, and warehouse equipment for the nine months ended March 31, 2025 and 2024 were

$ 1,515,688 and $ 658,713 , respectively.

Total operating lease expenses on offices, warehouses, and warehouse equipment for the six

months ended December 31, 2024 and 2023 were $ 989,003 and $ 439,142 , respectively.

finance lease expenses on warehouse machinery and equipment for the three months ended December 31, 2024 and 2023 were $ 9,415 and

$ 7,436 , respectively.

Depreciation of finance lease right-of-use assets were $ 7,886 and $ 7,053 for the three months ended

December 31, 2024 and 2023, respectively.

finance lease expenses on warehouse machinery and equipment for the six months ended December 31, 2024 and 2023 were $ 17,431 and

$ 15,099 , respectively.

Depreciation of finance lease right-of-use assets were $ 15,480 and $ 14,385 for the six months ended

December 31, 2024 and 2023, respectively.

following table includes supplemental cash flow and non-cash information related to leases:

For the six months ended

Total finance lease expenses

on warehouse machinery and equipment for the three months ended March 31, 2025 and 2024 were $ 10,613 and $ 8,756 , respectively.

of finance lease right-of-use assets were $ 8,600 and $ 8,756 for the three months ended March 31, 2025 and 2024, respectively.

Total finance lease expenses

on warehouse machinery and equipment for the nine months ended March 31, 2025 and 2024 were $ 28,044 and $ 23,854 , respectively.

of finance lease right-of-use assets were $ 24,081 and $ 22,548 for the nine months ended March 31, 2025 and 2024, respectively.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8 — LEASES

The following table includes

supplemental cash flow and non-cash information related to leases:

For the nine months ended

Cash paid of amounts included in the measurement of lease liabilities:

5 unchanged sentences

Operating lease liabilities

HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

8 — LEASES (cont.)

weighted average remaining lease terms and discount rates for all of operating lease and finance leases is as follows:

The weighted average remaining

lease terms and discount rates for all of operating lease and finance leases is as follows:

2025 June 30,

5 unchanged sentences

Finance lease 9.21 % 6.51 %

following is a schedule of maturities of operating and finance lease liabilities as of December 31, 2024:

Twelve months ending December 31,

The following is a schedule

of maturities of operating and finance lease liabilities as of March 31, 2025:

Operating leases

Twelve months ending March 31,

Total future minimum lease payments

1 unchanged sentence

Total operating lease liabilities

Twelve months ending December 31,

Financing leases

Twelve months ending March 31,

Total future minimum lease payments

1 unchanged sentence

Total finance lease liabilities

HOLDING LIMITED

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 — ACCRUED LIABILITIES AND OTHER PAYABLES

liabilities and other payables comprise the following amounts relating to the operation of the Company

Accrued liabilities and other payables comprise

the following amounts relating to the operation of the Company

Credit card payables

2 unchanged sentences

Other payables (b)

The balance mainly consists of accrued interest of $ 199,519 and $ 175,019 and accrued professional fee of $ 142,000 and $ 260,000 as

of December 31, 2024 and June 30, 2024, respectively.

The balance mainly consists of payable related to initial offering cost of $ 100,000 and $ 541,819 as of December 31, 2024 and June 30,

2024, respectively.

The balance mainly consists of accrued interest of $ 210,171

and $ 175,019 and accrued professional fee of $ 220,219 and $ 260,000 as of March

31, 2025 and June 30, 2024, respectively.

The balance mainly consists of payable related to initial offering

cost of nil and $ 541,819 as of March 31, 2025 and June 30, 2024, respectively.

NOTE 10 — LOANS PAYABLE

Company obtained multiple loans to finance the purchase of vehicles and warehouse machinery and obtained other loans to support its working

capital needs.

loan balance consists of the following:

The Company obtained multiple

loans to finance the purchase of vehicles and warehouse machinery and obtained other loans to support its working capital needs.

The loan balance consists of the following:

Equipment loans

2 unchanged sentences

Loan payable, non-current

December 7, 2020, the Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 48,033 at

a fixed interest rate of 3.99 % per annum with a maturity date of December 1, 2025 .

The loan balance was $ 10,387 and $ 15,427 as of

December 31, 2024 and June 30, 2024, respectively.

March 9, 2021, the Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 12,700 at a

fixed interest rate of 3.99 % per annum with a maturity date of July 6, 2025 .

The loan balance was $ 1,980 and $ 3,642 as of December

31, 2024 and June 30, 2024, respectively.

April 7, 2021, the Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 12,700 at a

fixed interest rate of 3.99 % per annum with a maturity date of July 6, 2025 .

Equipment loans

On December 7, 2020,

the Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 48,033 at a fixed interest rate of

3.99 % per annum with a maturity date of December 1, 2025 .

The loan balance was $ 7,829 and $ 15,427 as of March 31, 2025 and June 30,

2024, respectively.

On March 9, 2021, the

Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 12,700 at a fixed interest rate of 3.99 %

per annum with a maturity date of July 6, 2025 .

The loan balance was $ 1,137 and $ 3,642 as of March 31, 2025 and June 30, 2024, respectively.

On April 7, 2021, the

Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 12,700 at a fixed interest rate of 3.99 %

per annum with a maturity date of July 6, 2025 .

The loan was guaranteed by Mr.

Henry Liu, the

Chairman of the Board and CEO.

The loan balance was $ 1,980 and $ 3,642 as of December 31, 2024 and June 30, 2024, respectively.

HOLDING LIMITED

Henry Liu, the CEO.

The loan balance was

$ 1,137 and $ 3,642 as of March 31, 2025 and June 30, 2024, respectively.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 — LOANS PAYABLE (cont.)

June 4, 2021, the Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 26,800 at a fixed

interest rate of 3.79 % per annum with a maturity date of June 3, 2025 .

The loan balance was $ 3,576 and $ 7,085 as of December 31,

2024 and June 30, 2024, respectively.

June 14, 2021, the Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 20,724 at a

fixed interest rate of 6 % per annum with a maturity date of August 06, 2024 .

The loan balance was $ nil and $ 1,252 as of December

31, 2024 and June 30, 2024, respectively.

July 13, 2021, the Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 8,465 at a fixed

interest rate of 6 % per annum with a maturity date of June 30, 2024 .

The loan balance was $ nil and $ 256 as of December 31, 2024

and June 30, 2024, respectively.

September 28, 2021, the Company entered into another equipment loan with Toyota Commercial Finance for a principal amount of $ 23,600

at a fixed interest rate of 3.54 % per annum with a maturity date of June 30, 2024 .

The loan balance was $ nil and $ 690 as of December

31, 2024 and June 30, 2024, respectively.

February 21, 2023, the Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 29,705 at

a fixed interest rate of 7.90 % per annum with a maturity date of February 20, 2027 .

The loan balance was $ 17,244 and $ 20,823 as

of December 31, 2024 and June 30, 2024, respectively.

June 10, 2021, the Company entered into an equipment loan with Amur Equipment Finance for a principal amount of $ 41,239 at a fixed

interest rate of 13.92 % per annum with a maturity date of June 9, 2026 .

The loan is personally guaranteed by Henry Liu, the Chairman

of the Board and CEO.

The loan term was 5 years .

The loan balance was $ 14,479 and $ 18,972 as of December 31, 2024 and June 30,

On June 4, 2021, the

Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 26,800 at a fixed interest rate of 3.79 %

per annum with a maturity date of June 3, 2025 .

The loan balance was $ 1,797 and $ 7,085 as of March 31, 2025 and June 30, 2024, respectively.

On June 14, 2021, the

Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 20,724 at a fixed interest rate of 6 %

per annum with a maturity date of August 06, 2024 .

The loan balance was nil and $ 1,252 as of March 31, 2025 and June 30, 2024, respectively.

On July 13, 2021, the

Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 8,465 at a fixed interest rate of 6 %

per annum with a maturity date of June 30, 2024 .

The loan balance was nil and $ 256 as of March 31, 2025 and June 30, 2024, respectively.

On September 28, 2021,

the Company entered into another equipment loan with Toyota Commercial Finance for a principal amount of $ 23,600 at a fixed interest rate

of 3.54 % per annum with a maturity date of June 30, 2024 .

The loan balance was nil and $ 690 as of March 31, 2025 and June 30, 2024,

respectively.

September 9, 2021, the Company entered into an equipment loan with Hatachi Capital America Corp.

for a principal amount of $ 28,450

at a fixed interest rate of 9.49 % per annum with a maturity date of March 15, 2026 .

The loan balance was $ 9,188 and $ 12,569 as of

December 31, 2024 and June 30, 2024, respectively.

The Company made the total principal repayments of $ 11,768 and $ 16,082

in connection with the above equipment loans during the three months ended December 31, 2024 and 2023, respectively.

Interest expenses

for the above-mentioned equipment loans amounted to $ 1,416 and $ 2,423 during the three months ended December 31, 2024 and 2023, respectively.

The Company made the total principal repayments of $ 25,523 and $ 31,906

in connection with the above equipment loans during the six months ended December 31, 2024, and 2023, respectively.

expenses for the above-mentioned equipment loans amounted to $ 3,056 and $ 5,105 for the six months ended December 31, 2024 and

On February 21, 2023,

the Company entered into an equipment loan with Toyota Commercial Finance for a principal amount of $ 29,705 at a fixed interest rate of

7.90 % per annum with a maturity date of February 20, 2027 .

The loan balance was $ 15,401 and $ 20,823 as of March 31, 2025 and June

30, 2024, respectively.

May 20, 2020, the Company entered into a vehicle loan with BMW Financial Services for a principal amount of $ 77,844 at a fixed interest

rate of 0.9 % per annum with a maturity date of June 4, 2025 .

The loan balance was $ 7,943 and $ 15,853 as of December 31, 2024 and

June 30, 2024, respectively.

July 29, 2021, the Company entered into a vehicle loan with AutoNation Honda O’Hare for a principal amount of $ 41,851 at a

fixed interest rate of 1.90 % per annum with a maturity date of August 10, 2025 .

On June 10, 2021, the

Company entered into an equipment loan with Amur Equipment Finance for a principal amount of $ 41,239 at a fixed interest rate of 13.92 %

per annum with a maturity date of June 9, 2026 .

The loan is personally guaranteed by Henry Liu, the CEO.

The loan term was 5 years .

The loan balance was $ 12,113 and $ 18,972 as of March 31, 2025 and June 30, 2024, respectively.

On September 9, 2021,

the Company entered into an equipment loan with Hatachi Capital America Corp.

for a principal amount of $ 28,450 at a fixed interest rate

of 9.49 % per annum with a maturity date of March 15, 2026 .

The loan balance was $ 7,436 and $ 12,569 as of March 31, 2025 and June

30, 2024, respectively.

The Company made the total

principal repayments of $ 11,984 and $ 16,052 in connection with the above equipment loans during the three months ended March 31, 2025

and 2024, respectively.

Interest expenses for the above-mentioned equipment loans amounted to $ 1,200 and $ 2,162 during the three

months ended March 31, 2025 and 2024, respectively.

The Company made the total

principal repayments of $ 37,507 and $ 47,958 in connection with the above equipment loans during the nine months ended March

31, 2025, and 2024, respectively.

Interest expenses for the above-mentioned equipment loans amounted to $ 4,256 and $ 7,267 during the nine

months ended March 31, 2025 and 2024, respectively.

Vehicle loans

On May 20, 2020, the

Company entered into a vehicle loan with BMW Financial Services for a principal amount of $ 77,844 at a fixed interest rate of 0.9 % per

annum with a maturity date of June 4, 2025 .

The loan balance was $ 3,974 and $ 15,853 as of March 31, 2025 and June 30, 2024, respectively.

On July 29, 2021, the

Company entered into a vehicle loan with AutoNation Honda O’Hare for a principal amount of $ 41,851 at a fixed interest rate of 1.90 %

per annum with a maturity date of August 10, 2025 .

The loan was guaranteed by Mr.

Henry Liu, the

Chairman of the Board and CEO.

The loan balance was $ 7,197 and $ 12,540 as of December 31, 2024 and June 30, 2024, respectively.

HOLDING LIMITED

Henry Liu, the CEO.

The loan balance

was $ 4,507 and $ 12,540 as of March 31, 2025 and June 30, 2024, respectively.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 — LOANS PAYABLE (cont.)

June 3, 2022, the Company entered into a vehicle loan with Tesla, Inc.

for a principal amount of $ 101,050 at a fixed interest rate

of 3.24 % per annum with a maturity date of June 18, 2027 .

The loan balance was $ 52,604 and $ 62,630 as of December 31, 2024 and June 30,

On June 3, 2022, the Company

entered into a vehicle loan with Tesla, Inc.

for a principal amount of $ 101,050 at a fixed interest rate of 3.24 % per annum with a maturity

date of June 18, 2027 .

The loan balance was $ 47,529 and $ 62,630 as of March 31, 2025 and June 30, 2024, respectively.

On January 23, 2023, the Company

entered into a vehicle loan with Tesla, Inc.

for a principal amount of $ 68,540 at a fixed interest rate of 5.34 % per annum with a maturity

date of February 9, 2029 .

The loan balance was $ 47,277 and $ 55,259 as of March 31, 2025 and June 30, 2024, respectively.

On October 4, 2024, the Company

entered into a vehicle loan with Tesla, Inc.

for a principal amount of $ 102,235 at a fixed interest rate of 9.14 % per annum with a maturity

date of October 18, 2030 .

The loan balance was $ 97,146 and $ nil as of March 31, 2025 and June 30, 2024, respectively.

The Company made the total

principal repayments of $ 17,731 and $ 14,042 in connection with the above vehicle loans during the three months ended March 31, 2025 and

2024, respectively.

January 23, 2023, the Company entered into a vehicle loan with Tesla, Inc.

for a principal amount of $ 68,540 at a fixed interest

rate of 5.34 % per annum with a maturity date of February 9, 2029 .

The loan balance was $ 49,973 and $ 55,259 as of December 31, 2024

and June 30, 2024, respectively.

On October 4, 2024, the

Company entered into a vehicle loan with Tesla, Inc.

for a principal amount of $ 102,235 at a fixed interest rate of 9.14 % per annum with

a maturity date of October 18, 2030 .

The loan balance was $ 100,447 and $ nil as of December 31, 2024 and June 30, 2024, respectively.

Interest expenses for the above-mentioned above vehicle loans amounted to $ 3,383 and $ 1,500 during the three

months ended March 31, 2025 and 2024, respectively.

The Company made the total

principal repayments of $ 16,119 and $ 13,947 in connection with the above vehicle loans during the three months ended December 31, 2024

principal repayments of $ 48,085 and $ 41,843 in connection with the above vehicle loans during the nine months ended March 31,

2025 and 2024, respectively.

Interest expenses for the above-mentioned above vehicle loans amounted to $ 3,136 and $ 1,595 during the three

months ended December 31, 2024 and 2024, respectively.

The Company made the total principal repayments of $ 30,354 and $ 27,801

in connection with the above vehicle loans during the six months ended December 31, 2024, and 2023, respectively.

expenses for the above-mentioned equipment loans amounted to $ 4,444 and $ 3,283 for the six months ended December 31, 2024 and

2023, respectively.

(a) The Company entered a loan of $ 300,000 with an unrelated party on March 1, 2022.

The loan is unsecured, with a fixed interest of 15 % per annum and payable on monthly basis, for 6 months period and matured on September 1, 2022 .

On September 1, 2022, both parties agreed to extend the loan’s principal payment term to on demand.

(b) The Company entered a loan of $ 200,000 with an unrelated party on July 26, 2021.

Interest expenses for the above-mentioned equipment loans amounted to $ 7,827 and $ 4,783 during the nine months

ended March 31, 2025 and 2024, respectively.

Company entered a loan of $ 300,000 with an unrelated party on March 1, 2022.

The loan is unsecured, with a fixed interest of 15 %

per annum and payable on monthly basis, for 6 months period and matured on September 1, 2022 .

On September 1, 2022, both

parties agreed to extend the loan’s principal payment term to on demand.

The Company has made repayment of $ 30,000 during the nine

months ended March 31, 2025.

(b) The Company entered a loan of $ 200,000 with an unrelated party

on July 26, 2021.

The loan is unsecured, with no interest bearing for 6 months period and matured on January 25, 2022 .

The Company paid a principal of $ 100,000 during the year ended June 30, 2021 and both parties agreed to extend the remaining principal balance of $ 100,000 payment term to on demand.

The Company paid a principal of $ 100,000 during the year ended June 30, 2021 and both parties agreed to extend the remaining principal

balance of $ 100,000 payment term to on demand.

On April 8, 2024, the Company entered another loan of $ 100,000 with the same party.

The loan is unsecured, with no interest bearing for a 6-month period and matured on September 7, 2024 .

The Company has made repayment of $ 200,000 during the six months ended December 31, 2024.

HOLDING LIMITED

loan is unsecured, with no interest bearing for a 6-month period and matured on September 7, 2024 .

The Company has made repayment

of $ 200,000 during the nine months ended March 31, 2025.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 — LOANS PAYABLE (cont.)

The loan is non-interest bearing, for a 12-month period, and matured on October 26, 2022 .

October 26, 2022, both parties agreed to extend the loan term to on demand.

(d) The Company entered a loan agreement of $ 100,000 with an unrelated party on July 3, 2023.

The loan is non-interest bearing, for a 6-month period.

April 10, 2024, the Company entered another loan agreement of $ 75,000 with same party.

Company entered a loan agreement of $ 50,000 with an employee on October 27, 2021.

The loan is non-interest bearing, for a 12-month

period, and matured on September 9, 2024 .

Company made repayment of $ 50,000 during the six months ended December 31, 2024.

Both parties agreed to extend the remaining principal

balance of $ 125,000 payment term to on demand

period, and matured on October 26, 2022.

On October 26, 2022, both parties agreed to extend

the loan term to on demand.

Company entered a loan agreement of $ 100,000 with an unrelated party on July 3, 2023.

The loan is non-interest bearing, for

a 6-month period.

On April 10, 2024, the Company entered

another loan agreement of $ 75,000 with same party.

The loan is non-interest bearing, for a 6-month period, and matured on September 9,

The Company made repayment of $ 60,000

during the nine months ended March 31, 2025.

Both parties agreed to extend the remaining principal balance of $ 115,000 payment term to

(e) The Company entered a loan of $ 125,000 with an unrelated party on August 17, 2023.

The loan is personally guaranteed by Henry Liu, the Chairman of the Board and CEO, with a fixed interest of 16.00 % per annum for 24 months period and matured on August 16, 2025 .

The loan is personally guaranteed by Henry Liu, the CEO, with a fixed interest of 16.00 % per annum for 24 months period and matured on August 16, 2025 .

The monthly payment is $ 6,120 blending of interest and principal.

(f) On October 16, 2024, the Company entered a loan of $ 150,000 with an unrelated party.

The loan is personally guaranteed by Henry Liu, the Chairman of the Board and CEO, with a fixed interest of 33.37 % per annum and payable on monthly basis, for 12 months period and matured on October 16, 2025 .

The loan is personally guaranteed by Henry Liu, the CEO, with a fixed interest of 33.37 % per annum and payable on monthly basis, for 12 months period and matured on October 16, 2025 .

The monthly payment is $ 16,250 for the first six months and $ 13,250 for the remaining six months blending of interest and principal.

(g) The Company entered a loan of $ 45,000 with an unrelated party on November 5, 2024.

The loan is personally guaranteed by Henry Liu, the Chairman of the Board and CEO, with a fixed interest of 24.16 % per annum and payable on monthly basis, for 12 months period and matured on November 5, 2025 .

The loan is personally guaranteed by Henry Liu, the CEO, with a fixed interest of 24.16 % per annum and payable on monthly basis, for 12 months period and matured on November 5, 2025 .

The monthly payment is $ 4,259 blending of interest and principal.

(h) The Company entered a loan of $ 99,975 with an unrelated party on January 21, 2025.

The loan is unsecured, with no interest bearing for 6 months period and matured on July 21, 2025.

The Company made the total

principal repayments of $ 74,458 and $ 18,360 in connection with the above other loans during the three months ended December 31, 2024 and

principal repayments of $ 80,851 and $ 108,362 in connection with the above other loans during the three months ended March 31, 2025 and

2024, respectively.

Interest expenses for the above-mentioned other loans amounted to $ 25,808 and $ 17,547 during the three months

ended December 31, 2024 and 2023, respectively.

The Company made the total principal repayments of $ 339,914 and $ 42,258 in connection

with the above other loans during the six months ended December 31, 2024 and 2023, respectively.

Interest expenses for the above-mentioned

other loans amounted to $ 38,064 and $ 42,451 for the six months ended December 31, 2024 and 2023, respectively.

repayment schedule for the Company’s loans is as follows:

Twelve months ending December 31,

ended March 31, 2025 and 2024, respectively.

The Company made the total principal repayments of $ 420,765 and $ 150,620 in connection with

the above other loans during the nine months ended March 31, 2025 and 2024, respectively.

Interest expenses for the above-mentioned other

loans amounted to $ 63,872 and $ 59,998 for the nine months ended March 31, 2025 and 2024, respectively.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 10 — LOANS PAYABLE (cont.)

The repayment schedule for the Company’s

loans is as follows:

Twelve months ending March 31,

Total undiscounted borrowings

imputed interest

HOLDING LIMITED

NOTE 11 — LOAN FROM A RELATED

On March 1, 2025, the Company

entered into a loan agreement with a related party for a principal amount up to $ 124,176 , bearing interest at a fixed interest rate of

7.79 % per annum, with a maturity date of March 1, 2028 .

There is no pledge and guarantee from the third part.

The loan balance was $ 124,176

and nil as of March 31, 2025 and June 30, 2024, respectively, and interest expense in connection with the loan for the three and nine

months ended March 31, 2025 was nil for both periods.

NOTE 12 — CONVERTIBLE NOTES

On March 5, 2025, the Company

entered into a securities purchase agreement (the “Securities Purchase Agreement”) with an institutional investor (the “Investor”).

Under the Securities Purchase

Agreement, the Company agreed to issue 7 % original issue discount secured convertible promissory notes (“Notes”) in the aggregate

principal amount of up to $ 4.5 million and accompanying Warrants (as defined below), in up to three separate tranches that are each subject

to certain closing conditions (the “Financing”).

On March 5, 2025, the initial closing of the first tranche (the “First

Closing of First Tranche”) occurred, pursuant to which the Company issued to the Investor a Note in a principal amount of $ 1,000,000

(the “First Tranche”).

For the subsequent closing of the first tranche, the Investor agreed to purchase an additional Note

in the principal amount of $ 500,000 , subject to the satisfaction of certain closing conditions including the Equity Conditions (as defined

in the Securities Purchase Agreement), after a resale Registration Statement on Form S-3 or S-1 (the “Resale Registration Statement”)

has been declared effective by the Securities and Exchange Commission (the “Commission”) for the registration of common stock

of the Company (the “Common Stock”) issuable upon conversion of the Notes and the Warrants (as defined below).

and the Investor may also, pursuant to the Securities Purchase Agreement, choose to consummate a second tranche and a third tranche of

financing, subject to certain closing conditions.

Pursuant to the Securities

Purchase Agreement, the Company agreed to issue, upon the consummation of the closing of each tranche, common stock purchase warrants

(“Warrants”) to the Investor, in each case to purchase a number of shares of common stock determined by dividing 40 % of the

applicable principal amount of the corresponding Note by the VWAP (as defined in the Securities Purchase Agreement) immediately prior

to the applicable closing date.

In the First Closing of the First Tranche, the Company issued Investor Warrants to purchase 318,827 shares

of common stock at an initial exercise price of $ 1.9098 per share, subject to certain adjustments set forth therein.

The Note is convertible into

Common Stock at an initial conversion price of $ 1.9098 , subject to certain adjustments (the “Conversion Price”), provided

that the Conversion Price shall not be reduced below $ 0.234 (the “Floor Price”).

The Note does not bear any interest absent

an Event of Default (as defined in the Note) and matures on June 5, 2026.

Commencing on the earlier of (i) the 60-day anniversary after

the date hereof and (ii) the date on which the first Resale Registration Statement shall have been declared effective by the Commission,

the Company is required to pay to the Investor the outstanding principal balance under the Note in monthly installments, on such date

and each one (1) month anniversary thereof, in an amount equal to 105 % of the total principal amount multiplied by the quotient determined

by dividing one by the number of months remaining until the maturity date of the Note, until the outstanding principal amount has been

paid in full or, if earlier, upon acceleration, conversion or redemption of the Note in accordance with its terms.

All monthly payments

are payable by the Company, in cash, provided that under certain circumstances, as provided in the Note, the Company may elect to pay

in common stock.

At any time after the original issuance date, the Note shall be convertible (in whole or in part) at the option of the

Investor into such number of fully paid and non-assessable shares of Common Stock as is determined by dividing (x) that portion of the

outstanding Principal and any accrued and unpaid interest thereon that Invest elects to convert by (y) the Applicable Conversion Price

then in effect on the date.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12 — CONVERTIBLE NOTES

The Company evaluated the

loan portion of the Note and the accompanying warrant under the guidance of ASC 470-20, “Debt with Conversion and Other Options,”

and ASC 815, “Derivatives and Hedging.” The Company determined that the warrant met the criteria for equity classification

under ASC 815-40.

Accordingly, the fair value of the warrant was recorded as a component of additional paid-in capital on the issuance

The Company also evaluated

the conversion feature embedded in its convertible note under ASC 815 and determined that embedded derivative is clearly and closely related

to its host contract as its indexed to the Company's stock price and its underlying economic characteristics and risks.

As such, bifurcation

of the conversion feature as a derivative was not required.

The Company accounted for the Note as a liability under ASC 470-20.

is subsequently accounted for at amortized cost in accordance with the interest method under ASC 835-30.

The debt discount and issuance

cost will be amortized to interest expense over the term of the Note using the effective interest method.

On the issuance date, the

fair value of note payable with conversion feature was estimated using discounted cash flow method with a discount rate of 30 % for note

payable without conversion feature and Black-Scholes pricing model for the embedded conversion feature.

The fair value of warrants was

estimated using the Black-Scholes pricing model with the following weighted-average assumptions:

market value of underlying share of $ 1.21 ,

risk free rate of 4.08 %, expected term of 5 years;

exercise price of the warrants of $ 1.9098 , volatility of 120.4 %;

and expected future

dividends of nil .

The aggregate fair value of the debt and equity components exceeded the face value of the Note.

Accordingly, the Company

allocated the proceeds based on the relative fair value method.

The note also included an original issue discount and incurred total debt

issuance costs, which were allocated to the note payable and warrants on the relative fair value basis in accordance with ASC 835-30 and

The debt discount and issuance cost will be amortized to interest expense over the term of the Convertible Bonds using the

effective interest method.

The Company recorded a relative

fair value of note payable of $ 774,033 and relative fair value of warrants of $ 225,967 on issuance date.

After allocating the proceeds

of the liability and equity component, the Company allocated $ 244,488 initial purchaser’s discount and debt issuance cost of $ 70,000

and $ 174,488 , respectively.

The initial purchaser’s discount and debt issuance costs primarily consisted of underwriting fees ,

lawyers fee, investor legal fee, auditor fee and SEC registration fee.

These costs were allocated to the debt and equity component based

on the allocation of the proceeds as follows:

Equity Component

Debt Component

Initial purchaser’s debt discount

Debt issuance cost

The portion allocated to debt component is amortized to interest expense

using the effective interest method over the effected life of the Notes, or approximately 15 months term.

The effective interest rate

on the liability component of the Notes for the period from date of issuance is 95.52 % , which remains unchanged from the date of issuance.

Long Term Debt

Outstanding principal

Unamortized Initial Purchaser’s debt discount and debt issuance cost

Accrued interest

Net carry amount

Convertible note, current

Convertible note, non-current

The Company recognized interest

expense of $ 40,541 and $ 40,541 for the three and nine months ended March 31, 2025, which includes $ 24,517 related to the amortization

of the debt discount.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 13 — GENERAL AND ADMINISTRATIVE EXPENSES

For the six months ended

For the nine months ended

Payroll expense

20 unchanged sentences

Motor expense

Management fee

LAKESIDE HOLDING LIMITED

2 unchanged sentences

The relationship of related parties is summarized

Name of Related Party Relationship to the Company

Henry Liu Chairman of the Board, CEO, and an ultimate shareholder of the Company

Name of Related Party Relationship with the Company

Henry Liu CEO, and an ultimate shareholder of the Company

Shuai Li President, and an ultimate shareholder of the Company

10 unchanged sentences

a) Summary of balances with related parties

Due from related parties consist of mainly the

Due from related parties consists of mainly the

accumulated rent, storage fees and the salaries of contractors charged from the following parties:

1 unchanged sentence

Due from Intermodal

Due from ABL LAX LLC.

The Company has collected approximately $ 142,112 from Weship as of

the report date, and is planning to collect the remaining receivable balance from two related parties by the end of June 2025.

Due from ABL LAX

Company has collected approximately $ 26,447 from Weship and $ 1,332 from ABL LAX as of the report date, and is planning to collect the

remaining receivable balance from three related parties by the end of June 2025.

b) Summary of balances payable to related parties

2 unchanged sentences

Account payable to Intermodal

c) Summary of balances receivable from related parties

Accounts receivable from Weship

Accounts receivable from ABL Shenzhen

Accounts receivable from ABL Wuhan

The Company has collected approximately $ 0.2 million

from the related parties as of the report date.

LAKESIDE HOLDING LIMITED

1 unchanged sentence

NOTE 14 — RELATED PARTY TRANSACTIONS (cont.)

c) Summary of balances receivable from related parties

Account receivable from Weship

Account receivable from ABL Shenzhen

Account receivable from ABL Wuhan

The Company has collected approximately $ 0.2 million from the related

parties as of the report date.

d) Summary of related parties’ transactions

For the three months ended

Revenue from Weship

Revenue from ABL Wuhan

Revenue from ABL Shenzhen

Cost of revenue charged by Weship

Rental income from Weship

Cost of revenue charged by Intermodal

Cost of revenue charged by ABL Wuhan

For the six months ended

Revenue from Weship

Revenue from ABL Wuhan

Revenue from ABL Shenzhen

Cost of revenue charged by Weship

Rental income from Weship

Cost of revenue charged by Intermodal

Cost of revenue charged by ABL Wuhan

During the three and months ended December 31,

2024 and 2023, the Company had the following transactions with its related parties — Weship, ABL Wuhan, ABL Shenzhen and

The Company provides logistic forwarding services to Weship, ABL Wuhan and ABL Shenzhen and charges Weship, ABL Wuhan and ABL Shenzhen at its regular market rate for the services provided.

Weship is one of the Company’s vendors for truck delivery service.

The Company subleased portion of its warehouse space to Weship for rental income.

The Company subleased its warehouse in Chicago to Weship in July 2023 and again for the period from January 2024 to December 2024.

The Company also subleased another warehouse in Los Angeles beginning in August 2023 and ending in October 2024.

Intermodal is one of the Company’s vendors for truck delivery service.

ABL Wuhan provides labor force and certain cross-border freight consolidation and forwarding services and is one of our cross-border freight consolidation and forwarding service providers.

Revenue from Weship (a)

Revenue from ABL Wuhan (a)

Revenue from ABL Shenzhen (a)

Cost of revenue charged by Weship (b)

Rental income from Weship (c)

Rental income from Intermodal (d)

Cost of revenue charged by Intermodal (e)

Cost of revenue charged by ABL Wuhan (f)

For the nine months ended

Revenue from Weship (a)

Revenue from ABL Wuhan (a)

Revenue from ABL Shenzhen (a)

Cost of revenue charged by Weship (b)

Rental income from Weship (c)

Rental income from Intermodal (d)

Cost of revenue charged by Intermodal (e)

Cost of revenue charged by ABL Wuhan (f)

During the three and nine

months ended March 31, 2025 and 2024, the Company had the following transactions with its related parties — Weship, ABL

Wuhan, ABL Shenzhen and Intermodal

(a) The Company provides logistic forwarding services to Weship,

ABL Wuhan and ABL Shenzhen and charges Weship, ABL Wuhan and ABL Shenzhen at its regular market rate for the services provided.

(b) Weship is one of the Company’s vendors for truck delivery

for rental income.

The Company subleased its warehouse in Chicago to Weship in July 2023 and again for the period from January 2024 to March 2025.

(d) The Company subleased portion of its warehouse space to Intermodal for four months and another warehouse for twelve months.

(e) Intermodal is one of the Company’s vendors for truck delivery service.

(f) ABL Wuhan provides labor force and certain cross-border freight

consolidation and forwarding services and is one of our cross-border freight consolidation and forwarding service providers.

LAKESIDE HOLDING LIMITED

7 unchanged sentences

The Company had balance of due to shareholder Henry Liu of nil and $ 986,923 and Shuai

Li of $ nil and $ 31,358 as of December 31, 2024 and June 30, 2024, respectively.

Li of nil and $ 31,358 as of March 31, 2025 and June 30, 2024, respectively.

f) Dividend payable to shareholders

2 unchanged sentences

No non-taxable dividend

was declared to shareholders for the three and six months ended December 31, 2024.

As of December 31, 2024, dividends payable of $ 98,850

was offset against balances due from shareholders.

was declared to shareholders for the three and nine months ended March 31, 2025.

As of March 31, 2025, dividends payable of $ 98,850 were

offset against balances due from shareholders.

g) Salaries and employee benefits paid to major shareholders

For the three months ended

For the six months ended

For the nine months ended

LAKESIDE HOLDING LIMITED

34 unchanged sentences

liabilities of the change in tax rates resulting from becoming a C Corporation was recognized as a $ 17,894 increase to the net deferred

tax assets to $ 50,877 and an increase to the provision for income taxes of $ 17,894 during the three months ended December 31, 2023.

As of December 31, 2024 and

June 30, 2024, the Company did not have an accrued liability for uncertain tax positions and does not anticipate recognition of any

significant liabilities for uncertain tax positions during the next 12 months.

For the period ended December 31, 2024 and 2023, no

amounts were incurred for income tax uncertainties or interest and penalties.

The Company is currently not aware of any issues under review

that could result in significant payments, accruals, or material deviation from its position.

The Company’s tax years since

its formation remain subject to possible income tax examination by its major taxing authorities for all periods.

tax assets to $ 50,877 and an increase to the provision for income taxes of $ 17,894 during the nine months ended March 31, 2024.

As of March 31, 2025 and June

30, 2024, the Company did not have an accrued liability for uncertain tax positions and does not anticipate recognition of any significant

liabilities for uncertain tax positions during the next 12 months.

For the period ended March 31, 2025 and 2024, no amounts were

incurred for income tax uncertainties or interest and penalties.

The Company is currently not aware of any issues under review that could

result in significant payments, accruals, or material deviation from its position.

The Company’s tax years since its formation

remain subject to possible income tax examination by its major taxing authorities for all periods.

The provision for income tax

for the six months ended December 31, 2024 and 2023 consists of the following:

For the six months ended

for the nine months ended March 31, 2025 and 2024 consists of the following:

For the nine months ended

Current income tax expense

6 unchanged sentences

The following table reconciles

the statutory tax rate to the Company’s effective tax the six months ended December 31, 2024 and 2023:

For the six months ended

the statutory tax rate to the Company’s effective tax the nine months ended March 31, 2025 and 2024:

For the nine months ended

Loss before tax

$ ( 4,244,848 )

$ ( 216,936 )

Statutory state tax rate

2 unchanged sentences

Illinois replacement tax recovery

Non-deductible expense

Change in valuation allowance

2 unchanged sentences

Total income tax expense

The provision for income

tax for the three months ended December 31, 2024 and 2023 consists of the following:

The provision for income tax

for the three months ended March 31, 2025 and 2024 consists of the following:

For the three months ended

3 unchanged sentences

The following table reconciles

the statutory tax rate to the Company’s effective tax the three months ended December 31, 2024 and 2023:

the statutory tax rate to the Company’s effective tax the three months ended March 31, 2025 and 2024:

For the three months ended

5 unchanged sentences

Illinois replacement tax (recovery) expense

Non-deductible expense

Change in valuation allowance

1 unchanged sentence

Total income tax expense

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 15 — TAXES (cont.)

The Company’s deferred

18 unchanged sentences

Deferred tax (liability) assets, net

$ ( 104,717 )

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 16 — STOCKHOLDERS’ EQUITY

17 unchanged sentences

issuance expenses of a total of $ 1.0 million, were approximately $ 5.35 million.

As of December 31, 2024 and

June 30, 2024, 7,500,000 and 6,000,000 common shares were issued and outstanding, respectively, with par value of $ 0.0001 .

As of March 31, 2025 and June

30, 2024, 7,500,000 and 6,000,000 common shares were issued and outstanding, respectively, with par value of $ 0.0001 .

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 16 — STOCKHOLDERS’ EQUITY (cont.)

Additional Paid-in Capital

2 unchanged sentences

owners’ contribution to the capital of the Company upon the Reorganization and the termination of S corporation for ABL Chicago.

For the period ended December 31, 2024, the Company closed its IPO and net proceed from offering, deducted by the IPO deferring cost and

For the period ended March 31, 2025, the Company closed its IPO and net proceed from offering, deducted by the IPO deferring cost and

par value was transferred to additional paid-in capital.

Representative’s Warrants

On the issuance date of the

Notes, the Company recorded the relative fair value of the warrant of $ 170,720 after allocation of discount and issuance cost (see Note12)

as a component of additional paid-in capital, using the Black-Scholes pricing model.

Representative’s

Pursuant to the Underwriting

17 unchanged sentences

and expected future dividends of nil .

As of December 31, 2024, 75,000

As of March 31, 2025, 75,000

warrants in connection with IPO funding was outstanding, with an exercise price of $ 4.5 and remaining life of 4.50 years.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Common stock purchase warrants

Pursuant to the Securities

Purchase Agreement, the Company agreed to issue, upon the consummation of the closing of each tranche, common stock purchase warrants

(“Warrants”) to the Investor (see Note 12).

As of March 31, 2025, 318,827 warrants in connection with the Notes

were outstanding, with an exercise price of $ 1.9098 and remaining life of 4.93 years.

Statutory reserves

The Company is required to

make appropriations to certain reserve funds, comprising the statutory surplus reserve and the discretionary surplus reserve, based on

after-tax net income determined in accordance with generally accepted accounting principles of the PRC (“PRC GAAP”).

Appropriations

to the statutory surplus reserve are required to be at least 10 % of the after-tax net income determined in accordance with PRC GAAP until

the reserve is equal to 50 % of the entity’s registered capital.

Appropriations to the discretionary surplus reserve are made at

the discretion of the Board of Directors.

The statutory reserve as determined pursuant to PRC statutory laws totaled approximately $ 7,014

and nil as of March 31, 2025 and June 30, 2024, respectively.

NOTE 17 — EARNINGS (LOSS) PER SHARE

For the three and six months

ended December 31, 2024, the Company has no stock option issued and its warrants are considered to be antidilutive.

Thus, no impact on

diluted earnings per share.

For the three and six months ended December 31, 2023, the Company has no stock options and warrants issued

and no impact on diluted earnings per share.

For the three and nine months

ended March 31, 2025, the Company has no stock option issued and its warrants are considered to be antidilutive.

Thus, no impact

on diluted earnings per share.

For the three and nine months ended March 31, 2024, the Company has no stock options and warrants

issued and no impact on diluted earnings per share.

For the three months ended

2 unchanged sentences

Weighted average number of common shares outstanding – Basic and Diluted

(Loss) earnings per share – Basic and Diluted

For the six months ended

Loss per share – Basic and Diluted

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 17 — EARNINGS (LOSS) PER SHARE (cont.)

For the nine months ended

Net loss attributable to the Company

4 unchanged sentences

NOTE 18 — CONCENTRATIONS RISK

The Company had two and two third-party customers individually generated

over 10% of the Company’s total revenue for the six months ended December 31, 2024 and 2023, respectively.

The Company had no and

no related-party customer individually generated over 10% of the Company’s total revenue for the six months ended December 31, 2024

and 2023, respectively.

As of December 31, 2024 and June 30, 2024, the Company had one and one third-party customers and no and one related-party

customer individually represented over 10% of account receivables, respectively.

The Company had two and two

third-party customers individually generated over 10% of the Company’s total revenue for the nine months ended March 31, 2025 and

2024, respectively.

The Company had no and no related-party customer individually generated over 10% of the Company’s total revenue

for the nine months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025 and June 30, 2024, the Company had one and no third-party

customers and no and one related-party customer individually represented over 10% of account receivables, respectively.

The Company had no and no third-party suppliers individually represented

over 10% of the Company’s cost of revenue for six months ended December 31, 2024 and 2023, respectively.

over 10% of the Company’s cost of revenue for the nine months ended March 31, 2025 and 2024, respectively.

The Company had no and

one related-party suppliers individually represented over 10% of the Company’s cost of revenue for six months ended December 31,

no related-party suppliers individually represented over 10% of the Company’s cost of revenue for the nine months ended March 31,

2025 and 2024, respectively.

The Company had three and one third-party supplier and no and one related-party supplier represented

over 10% of the Company’s accounts payable as of December 31, 2024 and June 30, 2024, respectively.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company had one and one third-party supplier and no and one related-party supplier represented over

10% of the Company’s accounts payable as of March 31, 2025 and June 30, 2024, respectively.

NOTE 19 — SEGMENT REPORTING

4 unchanged sentences

Management of the Company

concludes that it has two reporting segments listed as below for the six months ended December 31, 2024.

concludes that it has two reporting segments listed as below for the nine months ended March 31, 2025.

The Company and its subsidiaries

3 unchanged sentences

and distribution of pharmaceutical products in China.

For the six months ended December

31, 2023, the Company’s CEO reviews consolidated results when making decisions about allocating resources and assessing performance

For the nine months ended

March 31, 2024, the Company’s CEO reviews consolidated results when making decisions about allocating resources and assessing performance

of the Company, rather than by service types or customer geographic location;

hence the Company concluded it has only one reporting segment.

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 19 — SEGMENT REPORTING (cont.)

The summary of key information

by segments for the six months ended December 31, 2024 was as follows:

Cross-border freight solutions (U.S.)

by segments for the nine months ended March 31, 2025 was as follows:

solutions (U.S.)

Pharmaceutical

Total for the

six months ended December 31,

the nine months

Revenue from external customers

10 unchanged sentences

$ ( 4,353,023 )

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 20 — COMMITMENTS AND CONTINGENCIES

Contractual Commitments

As of December 31, 2024, the Company’s contractual

As of March 31, 2025, the Company’s contractual

obligations consist of the following:

2 unchanged sentences

Finance lease obligations

Construction-in-progress project

Vehicle loans

Equipment loans

Convertible note

Loan payable to a related party

Contingencies

7 unchanged sentences

liability resulting from the outcome of such proceedings, to the extent not otherwise provided or covered by insurance, will not have

a material adverse effect on the Company’s consolidated financial position or results of operations or liquidity as of December

31, 2024 and June 30, 2024.

a material adverse effect on the Company’s consolidated financial position or results of operations or liquidity as of March 31,

LAKESIDE HOLDING LIMITED

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 21 — ASSETS ACQUISITION

8 unchanged sentences

hold in Hupan Pharmaceutical, for a total consideration of RMB 4.0 million (US$ 552,730 ).

The acquisition was accounted for as an asset acquisition because the

acquisition was related to the pharmaceutical distribution license, a single asset.

The acquisition was closed on November 21, 2024.

following table summarizes the fair value of the identifiable assets:

The acquisition was accounted

for as an asset acquisition because the acquisition was related to the pharmaceutical distribution license, a single asset.

The acquisition

was closed on November 21, 2024.

The following table summarizes the fair value of the identifiable assets:

Payable to Hupan Pharmaceutical

6 unchanged sentences

Total net assets acquired

The Company recorded impairment

of intangible assets of nil and nil , respectively, for the three and six months ended December 31, 2024 and 2023

The Company recorded impairment of intangible assets of nil and nil ,

respectively, for the three and nine months ended March 31, 2025.

NOTE 22 — SUBSEQUENT EVENTS

The Company evaluated all

events and transactions that occurred after December 31, 2024 up through the date the Company issued these condensed consolidated financial

events and transactions that occurred after March 31, 2025 up through the date the Company issued these condensed consolidated financial

statements, and unless disclosed below, there are not any material subsequent events that require disclosure in these condensed consolidated

financial statements.

Subsequent closing of the first tranche

On April 22, 2025, the subsequent

closing of the first tranche (the “Subsequent Closing”) was consummated, pursuant to which the Company issued to the Investor

a Note in a principal amount of $ 500,000 and certain Warrants to purchase 202,082 shares of common stock at an initial exercise price

of $ 1.1929 per share, subject to adjustments in the Warrants.

The Note issued in the Subsequent Closing is convertible into Common Stock

at an initial conversion price of $ 1.1929 , subject to certain adjustments (the “Conversion Price”), provided that the Conversion

Price shall not be reduced below $ 0.2 (the “Floor Price”).

The Note does not bear any interest absent an Event of Default

(as defined in the Note) and matures on July 22, 2026.

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-Q

Item 1. Financial Statements