NOTE 4. CONTRACT ASSETS/(LIABILITIES)

Projects with performance obligations recognized over time that have revenue recognized to date in excess of cumulative billings are reported on the Company’s balance sheets as “Contract assets”. Provisions for estimated losses of contract assets on uncompleted contracts are made in the period in which such losses are determined. Contract assets that have billing terms with unconditional rights to be billed beyond one year are classified as non-current assets.

Contract assets consisted of the following at June 30, 2026 and March 31, 2026:

SCHEDULE OF CONTRACT ASSETS

Contract liabilities consisted of the following at June 30, 2026 and March 31, 2026:

SCHEDULE OF CONTRACT LIABILITIES

Contract liabilities related to contracts are balances due to customers under contracts. This arises if a particular milestone payment exceeds the revenue recognized to date under the cost-to-cost method.

The movement in contract liabilities is as follows:

SCHEDULE OF MOVEMENT IN CONTRACT LIABILITIES

Real World Asset Tokenization Service Agreement with Vero 60 LLC and Vero Beach Land Development LLC

On May 8, 2026, the Company entered into a Real World Asset Tokenization Service Agreement (the “Vero 60 Agreement”) through its proprietary Hearth RWA tokenization platform with Vero 60 LLC and Vero Beach Land Development LLC (or its designated special purpose vehicle) (the “Vero 60”).

Under the Vero 60 Agreement, the Company will provide blockchain-based tokenization technology infrastructure services in connection with Vero 60’s residential real estate development project located in Vero Beach, Florida (the “Vero 60 Project”). The Vero 60 Project consists of the redevelopment of an existing agriculture property into a low-density residential community. The projected stabilized value of the completed Vero 60 Project, as estimated by Vero 60, is approximately $500 million, subject to confirmation by an independent valuation report prior to token issuance. The projected Vero 60 Project value reflects Vero 60’s estimate for the completed development and does not represent any economic interest of the Company in the underlying real estate.

As consideration for the technology and tokenization infrastructure services described in the Vero 60 Agreement, Vero 60 has agreed to pay the Company a platform technology fee of $7.5 million (the “Platform Technology Fee”), payable in two installments of $3.75 million each, subject to satisfaction of the milestones specified in the Vero 60 Agreement. The Platform Technology Fee is payable in U.S. dollars or, at Vero 60’s election, in Bitcoin or USD Coin, in each case as more fully described in the Vero 60 Agreement. The Company has received the first installment of $3.75 million in accordance with the terms of the Vero 60 Agreement.

On May 13, 2026, the Company received 6,250,000 PPDF tokens in purported settlement of the first installment of the Platform Technology Fee, which had a stated contractual amount of $3.75 million. As of June 30, 2026, the Company had performed only internal preparatory activities and had not made any substantive deliverables to Vero 60. Accordingly, the applicable performance obligation had not been satisfied, and no revenue was recognized. The consideration received was therefore treated as a contract liability rather than revenue. Consistent with the accounting applied to the 12,500,000 PPDF tokens previously received by the Company, the Company was unable to reliably determine the fair value of the PPDF tokens due to the absence of an active market, sufficient trading activity and other observable pricing information. Accordingly, both the PPDF tokens received and the corresponding contract liability had a carrying value of nil as of June 30, 2026.

OFA GROUP

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

THREE MONTHS ENDED JUNE 30, 2026 AND 2025