Abvc Biopharma, Inc. - 8-K

Item 4.02 Non-Reliance on Previously Issued Financial Statements or
a Related Audit Report or Completed Interim Review.

On February 25, 2026, the Board of Directors (the
“ Board ”) of ABVC Biopharma, Inc. (the “ Company ”), after discussion with management and in consultation
with the Company’s independent registered public accounting firm, concluded that the financial statements for the quarterly period
ended September 30, 2025 (the “ Restated Period ”), as included in the Company’s Quarterly Report on Form 10-Q
for the respective periods (the “ Prior Filing ”), should no longer be relied upon due to errors in those financial statements,
specifically inappropriate revenue recognition and the inconsistent application of fair value measurement of certain acquired land.

During the three months ended September 30, 2025,
the Company received $595,950 and $200,000 in cash from OncoX and ForSeeCon, respectively, and recognized licensing revenues accordingly.
Subsequently at the time of preparing the annual financial statements for the year ended December 31, 2025, management realized that
the funds paid by OncoX and ForSeeCon were either partially or fully borrowed from BioFirst, the Company’s related party, as well
as an investee over which the Company has significant influence. Management considered that since the Company has certain balances due
from Biofirst as of September 30, 2025, the funds received from OncoX and ForSeeCon, in the amounts of $560,000 and $200,000, respectively
may have indirectly come from the Company. Therefore, such cash receipts should not be recognized as revenue according to the licensing
agreement and ASC 606. As a result, the Company reversed the revenue recognized from Oncox and from ForSeeCon in the amount of $560,000
and $200,000, respectively, as a total of $760,000, against the balance due from related party – BioFirst. Of the total consideration
received, $35,950 was sourced from OncoX’s existing operating funds rather than from a qualifying fundraising event. Because the
licensing agreement requires that payments be funded exclusively from the proceeds of OncoX’s next financing round, this amount
does not satisfy the contractual conditions for payment under the arrangement. As a result, we derecognized $35,950 in revenue and reclassified
it as a balance due to OncoX. The total amount of revenue reversed was aggregate $795,950.

On July 15, 2025, the Company entered into a definitive
agreement with one of its directors, Shuling Jiang (“Shuling”), pursuant to which Shuling was to transfer the ownership of
certain land she owns, with estimated fair value of $3,857,975, located at Taoyuan City, Taiwan, to the Company. Historically,
management concluded that the fair value of the land acquired, as determined by an independent third-party real estate appraisal, was
clearer evidenced than the fair value of the unlisted equity instruments issued. Therefore, the Company originally recorded the asset based
on the appraised value of the land. The Company subsequently determined that the fair value of the equity consideration, derived primarily
from the Company's publicly quoted stock price is clearer evidenced and a more reliable measure of fair value.

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As approved at the last annual shareholder
meeting, the Company shall pay Shuling (i) 2,035,136 restricted shares of the Company’s common stock (the
“Shares”) at a price of $1.65 per share and (ii) five-year warrants to purchase up to 1,000,000 shares of the
Company’s common stock, with an exercise price of $2.50 per share. Based on the public market price of the Company’s
common stock on June 3, 2025, and the fair value of the warrants issued in this transaction, based on the Black-Scholes valuation
model, the Company concluded that the value of the land acquired should be $4,656,461, resulting in an increase of $798,486 in the
recognized cost of the land.

The Company intends to file an amendment to the Prior
Filing and related disclosures as promptly as practicable. The Company has also considered the guidance in ASC 250, Accounting Changes
and Error Corrections, and will include appropriate disclosures regarding the nature of the misstatements and the impact of the corrections.

The Company’s Audit Committee discussed the
matters disclosed in this Item 4.02 with its independent registered public accounting firm, Simon & Edward, LLP.

Due to the above, the Company determined that it has
a material weakness in its internal controls over financial reporting and shall include such determination in its Annual Report on Form
10-K for the year ended December 31, 2025.

Item 9.01 Exhibits

(d) Exhibits

Exhibit No.

Description

99.1

Press Release

104

Cover Page Interactive Data File, formatted in Inline XBRL

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