Item 4. Controls and Procedures
ITEM
4. CONTROLS
AND PROCEDURES.
Disclosure
Controls and Procedures
The
Securities and Exchange Commission (“SEC”) defines the term “disclosure controls and procedures” to mean
a company’s controls and other procedures of an issuer that are designed to ensure that information required to be disclosed
in the reports that it files or submits under the Securities Exchange Act of 1934 (the “Exchange Act”) is recorded,
processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls
and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed
by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s
management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate
to allow timely decisions regarding required disclosure. The Company maintains such a system of controls and procedures in an
effort to ensure that all information which it is required to disclose in the reports it files under the Exchange Act is recorded,
processed, summarized and reported within the time periods specified under the SEC’s rules and forms and that information
required to be disclosed is accumulated and communicated to principal executive and principal financial officers to allow timely
decisions regarding disclosure.
As
of the end of the period covered by this report, the Company made an evaluation of the effectiveness of the design and operation
of the disclosure controls and procedures over financial reporting for the timely alert to material information required to be
included in the Company’s periodic SEC reports and of ensuring that such information is recorded, processed, summarized
and reported within the time periods specified. This evaluation resulted in the identification of significant deficiencies. Based
on the context in which the individual deficiencies occurred, management has concluded that these significant deficiencies, in
combination, represent a material weakness. The Company’s CEO and CFO also concluded that updates to the disclosure controls
and procedures should be made to improve the effectiveness of the controls and procedures to provide reasonable assurance of the
assurance of these objectives.
38
Changes
in Internal Control Over Financial Reporting
Mitigating these significant deficiencies,
however, is that, commencing in 2020 and 2021, the Company has a new management team and new members of the Board of Directors,
including a new Chair of the Audit Committee, and a new Chief Financial Officer, which are focused on transitioning the Company
to a new management approach, modern thinking, new systems and practices, modern approaches to engagement and a system of internal
controls and procedures. Management’s daily involvement i n
the business provides it with more than adequate knowledge to identify the areas of financial reporting risks and related controls.
In addition, the procedures followed are integrated within the daily responsibilities of the Company’s employees, allowing
management to rely on their own intimate knowledge and supervision of controls. As the Company’s business plan is implemented
and additional staff is added, management will be able to address these significant deficiencies.
Management
has also engaged a contract Controller and a third-party firm to assist in developing Disclosure Controls and Procedures and Internal
Controls Over Financial Reporting. The Company intends to remediate these significant deficiencies dependent on having the financial
resources available to complete them.
PART
II – OTHER INFORMATION
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.