{"url_path":"/sec/akan/10-k/2026/item-11","section_key":"item-11","section_title":"Item 11 QUANTITATIVE AND QUALITATIVE","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-09","source_url":"https://www.sec.gov/Archives/edgar/data/1888014/0001213900-26-066800-index.html","accession_number":"0001213900-26-066800","cik":"0001888014","ticker":"AKAN","issuer_name":"AKANDA CORP.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1888014/0001213900-26-066800-index.html","primary_entity_key":"0001888014","primary_entity_name":"AKANDA CORP."},"word_count":652,"has_tables":true,"body_markdown":"**ITEM 11. QUANTITATIVE AND QUALITATIVE\nDISCLOSURES ABOUT MARKET RISK**\n\n \n\nThe Company’s activities\nexpose it to a variety of financial risks: market risk (including foreign exchange and interest rate risks), credit risk and liquidity\nrisk. Risk management is the responsibility of the Company, which identifies, evaluates and, where appropriate, mitigates financial risks.\n\n** **\n\n**Foreign exchange risk**\n\n \n\nForeign exchange risk: is\nthe risk that the fair value of future cash flows for financial instruments will fluctuate because of changes in foreign exchange rates.\nThe Company has not entered into any foreign exchange hedging contracts. The Company is exposed to currency risk from the British Pound\n(“**GBP**”), the European Union Euro (“**EUR**”), Canadian dollar (“**CAD**”)\nand Mexican Dollar (“**MXN**”) through the following foreign currency denominated financial assets and liabilities:\n\n \n\nAs at (expressed in GBP) \nDecember 31,\n2025  \nDecember 31, 2024 \n\nFinancial assets \n   \n  \n\nCash \n£100  \n£16,558 \n\nTrade and other receivables \n 354  \n 293,055 \n\nLoan receivable \n —  \n 469,233 \n\n  \n£454  \n£778,846 \n\nFinancial liabilities \n    \n   \n\nTrade and other payables \n£2,126  \n£820,809 \n\n  \n£2,126  \n£820,809 \n\n \n\nAs at (expressed in EUR) \nDecember 31,\n2025  \nDecember 31, 2024 \n\nFinancial assets \n   \n  \n\nCash \n€11,304  \n€12,504 \n\nTrade and other receivables \n 3,076  \n 3,076 \n\n  \n€14,380  \n€15,580 \n\nFinancial liabilities \n    \n   \n\nTrade and other payables \n€5,263  \n€838 \n\nLoans and borrowings \n 124,890  \n 124,890 \n\n  \n€130,153  \n€125,728 \n\n \n\nAs at (expressed in CAD) \nDecember 31,\n2025  \nDecember 31, 2024 \n\nFinancial assets \n   \n  \n\nCash and cash held in trust \n$287,503  \n$5,473,500 \n\nLoans receivable \n —  \n 515,197 \n\n  \n$287,503  \n$5,988,697 \n\nFinancial liabilities \n    \n   \n\nTrade and other payables \n$4,137,013  \n$2,809,356 \n\nDue to related party \n 882,165  \n 425,962 \n\nLease liabilities \n 191,706  \n — \n\nLoans and borrowings \n 1,177,564  \n 315,557 \n\nConvertible promissory notes \n 1,446,893  \n — \n\nSecured promissory notes \n 10,465,530  \n — \n\nSecured convertible debenture \n 5,681,053  \n — \n\n  \n$23,981,924  \n$3,550,875 \n\n \n\n82\n\n \n\n \n\nAs at (expressed in MXN) \nDecember 31,\n2025  \nDecember 31, 2024 \n\nFinancial assets \n   \n  \n\nCash \n$5,028,415  \n$— \n\nTrade and other receivables \n 24,199,567  \n — \n\nDue from related parties \n 68,814  \n — \n\n  \n$29,296,796  \n$— \n\nFinancial liabilities \n    \n   \n\nTrade and other payables \n$5,425,846  \n$— \n\nLease liabilities \n 4,609,418  \n — \n\n  \n$10,035,264  \n$— \n\n \n\nBased on the above net exposures\nas at December 31, 2025, assuming that all other variables remain constant, a 5% appreciation or deterioration of the USD against\nthe GBP would result in a corresponding increase or decrease, respectively on the Company’s net income of approximately $nil (2024\n— $2,000), EUR — $5,000 (2024 — $5,000), CAD — $864,000 (2024 — $85,000) and MXN — $54,000\n(2024 — $nil).\n\n \n\n**Credit risk**\n\n \n\nCredit risk is the risk\nof financial loss to the Company if a partner or counterparty to a financial instrument fails to meet its contractual obligation and\narises principally from the Company’s cash and accounts receivable. The carrying amounts of the financial assets represents the\nmaximum credit exposure. The Company limits its exposure to credit risk on cash by placing these financial instruments with high-credit\nquality financial institutions.\n\n \n\nAt December 31, 2025, the\nCompany was subject to a concentration of credit risk related to its accounts receivable as 100% (2024 — 74% from two customers)\nof the balance of amounts owing is from three customers. The Company did not record any bad debt expense during the years ended December\n31, 2025 and 2024. As at December 31, 2025, the expected credit lifetime credit losses for accounts receivable aged as current were nominal\namounts. The Company considers a financial asset in default when internal or external information indicates that the Company is unlikely\nto receive the outstanding contractual amounts in full. A financial asset is written off when there is no reasonable expectation of recovering\nthe contractual cash flows.\n\n \n\n**Liquidity risk**\n\n \n\nLiquidity risk is the risk\nthat the Company will not be able to meet its financial obligations as they come due. The Company manages its liquidity risk by continuously\nmonitoring forecasted and actual cash flows, as well as anticipated investing and financing activities and to ensure that it will have\nsufficient liquidity to meet its liabilities and commitments when due and to fund future operations. The Company’s trade and other\npayables are due within the current operating year."}