NOTE 11 – INCOME TAXES

3 Months Ended

Nov. 30, 2023

Income Tax Disclosure [Abstract]

NOTE 11 – INCOME TAXES

NOTE 11 – INCOME TAXES

The Company and its fully owned subsidiary, AB Cinemas NY, Inc, were incorporated in the United States and are subject to a statutory income tax rate at 21%. The Company’s fully owned subsidiary, App Board Limited, was registered in Hong Kong and is subject to a statutory income tax rate at 16.5%.

As of November 30, 2023 and August 31, 2023, the components of net deferred tax assets, including a valuation allowance, were as follows:

	November 30, 2023			August 31, 2023
Deferred tax asset attributable to:
Net operating loss carry over	$	2,068,057		$	2,077,213
Less: valuation allowance		(2,068,057	)		(2,077,213	)
Net deferred tax asset	$	—		$	—

The valuation allowance for deferred tax assets was $2,068,057 and $2,077,213 as of November 30, 2023 and August 31, 2023, respectively. In assessing the recovery of the deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income in the periods in which those temporary differences become deductible. Management considers the scheduled reversals of future deferred tax assets, projected future taxable income, and tax planning strategies in making this assessment. As a result, management determined it was more likely than not the deferred tax assets would not be realized as of November 30, 2023 and August 31, 2023.

Reconciliation between the statutory rate and the effective tax rate is as follows for the three months ended November 30, 2023 and 2022:

	Three months ended
	November 30,
	2023			2022
Federal statutory tax rate		21	%		21	%
Change in valuation allowance		(21	%)		(21	%)
Effective tax rate		0	%		0	%

During the three months ended November 30, 2023, the Company and its subsidiaries generated net income. As a result, the Company and its subsidiaries utilized the tax losses for the three months ended November 30, 2023.

During the three months ended November 30, 2022, the Company and its subsidiaries incurred net losses. As a result, the Company and its subsidiaries did not incur any income tax for the three months ended November 30, 2022.

AB INTERNATIONAL GROUP CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)