PATHWARD FINANCIAL, INC. 10-Q

Item 4. Controls and Procedures. EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES Management, under the direction of its Chief Executive Officer and Chief Financial Officer, is responsible for maintaining disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "1934 Act")) that are designed to ensure that information required to be disclosed in reports filed or submitted under the 1934 Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to management, including the Company's Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures. In connection with the preparation of this Quarterly Report on Form 10-Q, management evaluated the Company's disclosure controls and procedures. The evaluation was performed under the direction of the Company's Chief Executive Officer and Chief Financial Officer to determine the effectiveness, as of June 30, 2026, of the design and operation of the Company's disclosure controls and procedures. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of June 30, 2026, the Company’s disclosure controls and procedures were effective. This conclusion was reached following management's remediation of the material weakness in internal control over financial reporting described in Item 9A of Amendment No. 1 to the Annual Report on Form 10-K/A for the year ended September 30, 2024 filed with the SEC on August 29, 2025, and management's determination, based on testing, that the related controls were operating effectively. 52 Table of Contents INHERENT LIMITATIONS ON THE EFFECTIVENESS OF CONTROLS Any control system, no matter how well designed and operated, can provide only reasonable (not absolute) assurance that its objectives will be met. Furthermore, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in a cost-effective control system, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected. REMEDIATION OF PREVIOUSLY IDENTIFIED MATERIAL WEAKNESS Management, under the oversight of the Audit Committee, completed its remediation of the previously identified material weakness during the quarter ended June 30, 2026. The remediation included the design, implementation, and operation of enhanced controls for a sufficient period of time, as well as management's testing of those controls. Based on the results of that testing, management concluded that the controls are operating effectively and that the material weakness has been remediated as of June 30, 2026. As part of its remediation efforts, management implemented the following actions: • The Company engaged a third-party technical accounting consultant to assist with the identification, assessment and accounting and financial reporting impacts for certain consumer lending program agreements in the Consumer Solutions business; and • The Company designed and implemented an enhanced control over the periodic review and validation of accounting policies and accounting treatment for certain consumer lending program agreements within the Consumer Solutions business to help ensure both the initial and continuing compliance with applicable U.S. GAAP, including consideration of whether engagement with a third-party technical accounting consultant was necessary. CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING During the quarter ended June 30, 2026, the Company implemented changes to its internal control over financial reporting as part of the remediation of the previously disclosed material weakness. Based on management's testing and evaluation, the Company concluded that the material weakness was remediated as of June 30, 2026. Other than these remediation activities, there were no changes in the Company's internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the 1934 Act) during the fiscal third quarter of 2026 that materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting. 53 Table of Contents PART II - OTHER INFORMATION