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Disposal of Subsidiaries and Discontinued Operations

12 Months Ended

Dec. 31, 2024

Disposal of Subsidiaries and Discontinued Operations [Abstract]

DISPOSAL OF SUBSIDIARIES AND DISCONTINUED OPERATIONS

NOTE 18 — DISPOSAL OF SUBSIDIARIES AND DISCONTINUED OPERATIONS

Hanryu Bank Co. Ltd (“HBC”) sold 100% of its shares in FNS Co. Ltd for $733 and Marin Island Co. Ltd for $367 on November 5, 2024, to improve its financial structure. Additionally, Global Interactive Technologies, Inc. (“the Company”) sold 100% of its shares in Hanryu Bank Co. Ltd (“HBC”) for $2,200 on December 28, 2024. From the date of these sales, the three subsidiaries are no longer included in the consolidated financial statements and are classified as discontinued operations. A gain of $18,832,006 was recognized from the disposal of the shares in these three subsidiaries.

The following table outlines the calculation of the gain on disposal related to the sale of the subsidiaries on November 5, 2024, and December 28, 2024.

		As of December 28, 2024
Consideration received (sale price)		$	3,300

The carrying amount of any noncontrolling interest			—
Net liabilities			11,502,964
foreign exchange difference			894,109
Gain on disposal of subsidiaries		$	12,400,373

1. In connection with the deconsolidation of Hanryu Bank Co.Ltd in 2024, the Company reclassified $7,164,430 of Additional Paid-in Capital to Accumulated Deficit, in accordance with ASC 810-10-40. This amount was arouse from group restructuring of the same subsidiary’s equity at the consolidated level, resulting from differences between the subsidiary’s equity structure and the consolidated equity accounts. The reclassification is reflected in the Consolidated Statement of Stockholders’ Equity for the year ended December 31, 2024.

2. The gain or loss on the disposal of investments in subsidiaries was calculated based on the difference between the consideration received and the net assets of the subsidiaries. In this process, the net assets of the subsidiaries were translated using the exchange rate as of December 31, 2024, while the gain or loss on disposal was calculated using the average exchange rate for the year 2024. As a result, a foreign exchange difference arose due to the use of different exchange rates. This difference was not recognized separately as a foreign exchange gain or loss, but was included in the gain or loss on disposal.

The financials of the three companies for the years ended December 31, 2024 and December 31, 2023 are as follows.

		December 31, 2024				December 31, 2023
CURRENT ASSETS:		$	39,653,805			$	17,415,555
Cash and Cash Equivalents			1,408				5,358,142
Short-term loans			26,550,250				3,658,820
Accounts receivable, net of allowance			5,971,432				324,413
Non-trade receivables			24,320				171,893
Prepaid expenses and other receivables			7,106,395				7,902,287
PROPERTY PLANTAND EQUIPMENT, NET			247,188				505,155
Operating lease right-of-use asset			—				1,918,966
Other Asset			216,258				379,735
Total Assets		$	40,117,251			$	20,219,411

CURRENT LIABILITIES:		$	51,620,215			$	—
Short-term borrowings			40,248,754				1,589,887
Non-trade accounts payable			8,211,344				2,312,669
Bonds with Warrants			3,061,224				3,489,995
Accrued expenses and other current liabilities			98,893				83,940
Total Liabilities		$	51,620,215			$	7,476,491
Total Stockholder’s Equity (Deficiency)		$	(11,502,964	)		$	12,742,920

		December 31, 2024				December 31, 2023
Sales			196				827,489
Cost of Revenue			—				79,097
Gross profit (Loss)		$	196			$	748,392
OPERATING EXPENSES:			1,489,006				10,483,401
OPERATING LOSS			(1,488,810	)			(9,735,009	)
OTHER INCOME(EXPENSE):			100,492				(2,178,706	)

Net loss before taxes			(1,338,318	)			(7,556,303	)
Income tax expense			—				—
NET INCOME(LOSS)		$	(1,338,318	)		$	(7,556,303	)