3 unchanged sentences
Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure.
−Removed: Based on the evaluation of our disclosure controls and procedures, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of December 31, 2022 due to the material weaknesses in our internal control over financial reporting described below.
−Removed: In light of this fact, our management has performed additional analyses, reconciliations, and other post-closing procedures and has concluded that, notwithstanding the material weaknesses in our internal control over financial reporting, the consolidated financial statements for the periods covered by and included in this Annual Report fairly present, in all material respects, our financial position, results of operations and cash flows for the periods presented in conformity with GAAP.
+Added: Based on the evaluation of our disclosure controls and procedures, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of December 31, 2023.
Management's Report on Internal Control over Financial Reporting
7 unchanged sentences
Management, under the supervision of and with the participation of the Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2023 using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in "Internal Control—Integrated Framework" (2013).
−Removed: Based on this assessment, management determined that the Company’s internal control over financial reporting as of December 31, 2022 was not effective due to the material weaknesses described below.
+Added: Based on this assessment, management determined that the Company’s internal control over financial reporting as of December 31, 2023 was effective.
+Added: Remediation of Previously Disclosed Material Weaknesses
+Added: As previously disclosed, we identified material weaknesses in our internal control over financial reporting.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.
−Removed: • We did not design or maintain an effective control environment as we lacked sufficient oversight of activities related to our internal control over financial reporting due to a lack of an appropriate level of experience and training commensurate with public company requirements.
−Removed: This material weakness resulted in our identification of the following additional material weaknesses;
−Removed: • We did not maintain formal accounting policies and procedures, and did not design, document and maintain controls related to substantially all of our business processes to achieve complete, accurate and timely financial accounting, reporting and disclosures, including controls over account reconciliations, segregation of duties and the preparation and review of journal entries;
−Removed: • We did not design and maintain effective controls over information technology, or IT, general controls for information systems and applications that are relevant to the preparation of the consolidated financial statements.
−Removed: Specifically, we did not design and maintain (i) program change management controls to ensure
−Removed: that IT program and data changes affecting financial IT applications and underlying accounting records are identified, tested, authorized and implemented appropriately that are relevant to the preparation of our financial statements, (ii) user access controls to ensure appropriate segregation of duties and that adequately restrict user and privileged access to financial applications, programs, and data to appropriate personnel, (iii) computer operations controls to ensure that critical batch jobs are monitored and data backups are authorized and monitored, and (iv) testing and approval of controls for program development to ensure that new software development is aligned with business and IT requirements.
−Removed: These IT deficiencies, when aggregated, could impact effective segregation of duties as well as the effectiveness of IT-dependent controls that could result in misstatements potentially impacting all financial statement accounts and disclosures that would not be prevented or detected.
−Removed: Accordingly, our management has determined these deficiencies in the aggregate constitute a material weakness.
−Removed: None of the material weaknesses described above resulted in a material misstatement to our annual or interim consolidated financial statements.
−Removed: However, each of the material weaknesses described above could result in a misstatement of one or more account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected.
−Removed: Remediation Plans
−Removed: To date, we have implemented certain measures to address the identified material weaknesses.
−Removed: These measures include adding personnel as well as improving our internal controls around financial systems and processes.
−Removed: We intend to continue to take steps to remediate the material weaknesses described above and further evolve our internal controls and processes.
−Removed: We will not be able to remediate these material weaknesses until these steps have been completed and have been operating effectively for a sufficient period of time.
−Removed: The following remedial actions were taken through the year ended December 31, 2021:
+Added: The material weaknesses identified related to the effectiveness of our control environment, including a lack of an appropriate level of experience and training commensurate with public company requirements.
+Added: This lack of an effective control environment contributed to material weaknesses related to the maintenance of formal accounting policies and procedures, including controls over account reconciliations, segregation of duties and the preparation and review of journal entries, and the maintenance of effective controls over information technology, or IT, general controls for information systems and applications that are relevant to the preparation of the consolidated financial statements.
+Added: Specifically, we did not design and maintain (i) program change management controls to ensure that IT program and data changes affecting financial IT applications and underlying accounting records are identified, tested, authorized and implemented appropriately that are relevant to the preparation of our financial statements, (ii) user access controls to ensure appropriate segregation of duties and that adequately restrict user and privileged access to financial applications, programs, and data to appropriate personnel, (iii) computer operations controls to ensure that critical batch jobs are monitored and data backups are authorized and monitored, and (iv) testing and approval of controls for program development to ensure that new software development is aligned with business and IT requirements.
+Added: In response to the identified material weaknesses, we implemented a number of actions to improve our internal control over financial reporting, including the following:
• hired a Vice President of Internal Audit to oversee our internal controls program and work with management in its design and implementation of internal control over financial reporting;
1 unchanged sentence
• engaged a global accounting advisory firm to assist with the documentation, evaluation, remediation and testing of our internal control over financial reporting;
−Removed: The following remedial actions were taken during the year ended December 31, 2022:
−Removed: • evaluated our internal control over financial reporting with respect to design, implementation, and operating effectiveness;
−Removed: • added key resources to the Internal Audit team, including an IT expert;
+Added: • added key resources to the Internal Audit team, including an IT expert and an internal controls documentation and testing team reporting directly to the Vice President of Internal Audit;
+Added: • enhanced our IT general controls resources, including a new team dedicated to IT Risk & Compliance;
• formalized our accounting policies, including training relevant personnel, related to, but not limited to, account reconciliations and manual journal entries;
• formalized IT procedures for key financial systems, including training relevant personnel, related to segregation of duties, user access, batch jobs, data backups, change management, and program development;
−Removed: The following are the remaining remedial actions that management plans to undertake during 2023:
−Removed: • continue to enhance our IT general control resources, including the hiring of a new Chief Information Security Officer ("CISO");
−Removed: • ensure that the IT general controls specific to all key systems supporting financial reporting, including user access reviews, are being consistently operated and evidenced such that persuasive evidence is obtained that our IT general controls are effective and sustainable;
−Removed: • ensure that controls over key reports and data derived from systems supporting financial reporting are consistently evidenced;
−Removed: • ensure controls are fully in place to address segregation of duties risks that could present a reasonable possibility of material misstatements;
−Removed: • ensure that sufficient evidence of operating effectiveness is consistently demonstrated and maintained for key business process controls.
−Removed: While we believe that these efforts will improve our internal control over financial reporting, the implementation of our remediation is ongoing and will require testing of the design and operating effectiveness of internal controls over a sustained period of financial reporting cycles.
−Removed: We believe we have made substantial progress toward achieving effective internal control over financial reporting and disclosure controls and procedures.
−Removed: The actions that we are taking are subject to ongoing senior management review, as well as audit committee oversight.
−Removed: We will not be able to conclude whether the steps we are taking will remediate the material weaknesses in our internal control over financial reporting until we have completed our remediation efforts and subsequent evaluation of their effectiveness.
−Removed: We may also conclude that additional measures may be required to remediate the material weaknesses in our internal control over financial reporting.
+Added: • performed various trainings for control owners;
+Added: • ensured that controls over key reports and data derived from systems supporting financial reporting are consistently evidenced;
+Added: • ensured controls are in place to address segregation of duties risks that could present a reasonable possibility of material misstatements;
+Added: • ensured user access reviews are consistently operating and evidenced, effective and sustainable.
+Added: Management concluded that these and other actions taken have been fully implemented and are operating effectively as of December 31, 2023.
+Added: As a result, we have concluded the previously identified material weaknesses in our internal control over financial reporting have therefore been remediated.
Changes in Internal Control over Financial Reporting
11 unchanged sentences
Other Information.
+Added: During the three months ended December 31, 2023, no director or executive officer of the Company adopted , modified or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term
+Added: is defined in Item 408(a) of Regulation S-K.
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.
27 unchanged sentences
Compass Concierge receivable allowance for credit loss 14.7 0.8 ( 2.3 ) — 13.2
−Removed: Valuation allowance for deferred tax assets 448.4 — — 145.8 (b)
+Added: Valuation allowance for deferred tax assets 594.2 — — 70.7 (a)
December 31, 2022
1 unchanged sentence
Compass Concierge receivable allowance for credit loss 17.3 1.8 ( 4.4 ) — 14.7
−Removed: Valuation allowance for deferred tax assets 287.5 — — 160.9 (b)
+Added: Valuation allowance for deferred tax assets 448.4 — — 145.8 (a)
December 31, 2021
Accounts receivable allowance for credit loss 8.1 1.7 ( 2.7 ) — 7.1
−Removed: Compass Concierge receivable allowance for credit loss 4.7 9.1 ( 2.2 ) 5.6 (a)
−Removed: Valuation allowance for deferred tax assets 223.1 — — 64.4 (b)
−Removed: (a) The Company adopted ASU 2016-13, Financial Instruments — Credit Losses (Topic 326) as of January 1, 2020 on a modified retrospective basis which resulted in a $ 5.6 million increase in the Company’s overall allowance for credit losses related to the Company’s Compass Concierge receivables, with a corresponding increase to the Company’s accumulated deficit.
−Removed: (b) For the years ended December 31, 2022, 2021 and 2020, the increase in valuation allowance relates to U.S.
+Added: Compass Concierge receivable allowance for credit loss 17.2 7.2 ( 7.1 ) — 17.3
+Added: Valuation allowance for deferred tax assets 287.5 — — 160.9 (a)
+Added: (a) For the years ended December 31, 2023, 2022 and 2021, the increase in valuation allowance relates to U.S.
deferred tax assets for which the Company continues to maintain that the realization of these assets has not achieved a more-likely-than-not threshold.
4 unchanged sentences
Exhibit Filing Date Filed
−Removed: 3.1 Restated Certificate of Incor poration of the Registrant
+Added: 3.1 Restated Certificate of Incorporation of the Registrant
10-Q 001-40291 3.1 5/13/21
1 unchanged sentence
10-Q 001-40291 3.2 5/13/21
+Added: Number Incorporated by Reference
+Added: Exhibit Description Form File No.
+Added: Exhibit Filing Date Filed
4.1 Description of Common Stock
3 unchanged sentences
10.1+ Form of Indemnification Agreement by and between the Registrant and each of its directors and executive officers
−Removed: S-1 333-253744 10.1 3/1/21
10.2+ 2012 Stock Incentive Plan and forms of award agreements thereunder
5 unchanged sentences
10.5+ Non-Employee Director Compensation Policy
−Removed: S-1 333-253744 10.5 3/1/21
10.6+ Letter Agreement between the Registrant and Robert Reffkin, dated as of March 12, 2020, as amended
S-1/A 333-253744 10.6 3/23/21
−Removed: 10.7+ Offer Letter between the Registrant and Joseph Sirosh, dated as of March 12, 2021
−Removed: S-1/A 333-253744 10.9 3/23/21
10.7+ Offer Letter between the Registrant and Brad Serwin, dated as of March 12, 2021
1 unchanged sentence
10.8+ Form of Change in Control and Severance Agreement between the Registrant and its named executive officers
−Removed: S-1/A 333-253744 10.11 3/23/21
10.90 Lease Agreement between Urban Compass, Inc.
3 unchanged sentences
S-1/A 333-253744 10.14 3/23/21
−Removed: 10.12+ Form of Exchange Agreement between the Registrant and Robert Reffkin
−Removed: S-1 333-253744 10.14 3/1/21
−Removed: 10.13+ Form of Equity Exchange Right Agreement between the Registrant and Robert Reffkin
−Removed: S-1 333-253744 10.15 3/1/21
+Added: 10.11 First Amendment to Revolving Credit and Guaranty Agreement among Compass, Inc., Barclays Bank PLC and the lenders party thereto, dated as of May 1, 2023
+Added: 10-Q 001-40291 10.1 5/10/23
10.12+ Forms of Global Notice of Restricted Stock Unit Award and Global Restricted Stock Unit Award Agreement
2 unchanged sentences
10-Q 001-40291 10.3 8/10/21
−Removed: 10.16+ Executive Bonus Plan, effective as of March 1, 2022
−Removed: 8-K 001-40291 10.1 3/17/22
+Added: 10.14+ Forms of Global Notice of Performance Stock Unit Award and Global Performance Stock Unit Award Agreement
+Added: 10.15+ Executive Bonus Plan, amended and restated as of November 2, 2023
10.16+ Amended and Restated Offer Letter between the Registrant and Neda Navab, dated May 10, 2022
10-Q 001-40291 10.1 5/13/22
−Removed: 10.18+ Amended and Restated Offer Letter between the Registrant and Priyanka Singh, dated May 10, 2022
+Added: 10.17+ Amended and Restated Cash Bonus Agreement between the Registrant and Brad Serwin, dated as of August 17, 2023
+Added: 10.18+ Offer Letter between the Company and Kalani Reelitz, dated as of October 24, 2022
+Added: 8-K 001-40291 10.1 10/28/22
+Added: 10.19 Amended and Restated Revolving Credit and Security Agreement among Compass Concierge SPV I, LLC, Barclays Bank PLC and the lenders party thereto, dated as of August 5, 2022
10-Q 001-40291 10.1 8/15/22
−Removed: 10.19+ Second Amended and Restated Offer Letter between the Registrant and Kristen Ankerbrandt, dated May 10, 2022
+Added: 10.20 Amendment No.
+Added: 1 to the Second Amended and Restated Revolving Credit and Security Agreement among Compass Concierge SPV I, LLC, Barclays Bank PLC and the lenders party thereto, dated as of August 4, 2023
10-Q 001-40291 10.1 8/08/23
2 unchanged sentences
Exhibit Filing Date Filed
−Removed: 10.20+ Second Amended and Restated Offer Letter between the Registrant and Greg Hart, dated May 10, 2022
−Removed: 10-Q 001-40291 10.4 5/13/22
−Removed: 10.21 Amended and Restated Revolving Credit and Security Agreement among Compass Concierge SPV I, LLC, Barclays Bank PLC and the lenders party thereto, dated as of August 5, 2022
−Removed: 10-Q 001-40291 10.1 8/15/22
−Removed: 10.22+ Separation Agreement between the Registrant and Kristen Ankerbrandt, dated as of August 2, 2022
−Removed: 10-Q 001-40291 10.2 8/15/22
−Removed: 10.23+ Promotion Award Letter Agreement between the Registrant and Greg Hart, dated as of August 10, 2022
−Removed: 10-Q 001-40291 10.3 8/15/22
−Removed: 10.24+ Offer Letter between the Company and Kalani Reelitz, dated as of October 24, 2022
−Removed: 8-K 001-40291 10.1 10/28/22
21.1 Subsidiaries of the Registrant
5 unchanged sentences
32.2# Certification of Chief Financial Officer, pursuant to 18 U.S.C.
+Added: 97 Compass, Inc.
+Added: Compensation Recovery Policy, adopted November 2, 2023
101 The following financial information related to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, formatted in iXBRL (Inline Extensible Business Reporting Language):
7 unchanged sentences
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
−Removed: March 1, 2023 By /s/ Robert Reffkin
+Added: February 28, 2024 By /s/ Robert Reffkin
(Date) Robert Reffkin
4 unchanged sentences
Name Title Date
−Removed: /s/ Robert Reffkin Chairman of the Board of Directors and Chief Executive Officer March 1, 2023
+Added: /s/ Robert Reffkin Chairman of the Board of Directors and Chief Executive Officer February 28, 2024
Robert Reffkin (Principal Executive Officer)
−Removed: /s/ Kalani Reelitz Chief Financial Officer March 1, 2023
+Added: /s/ Kalani Reelitz Chief Financial Officer February 28, 2024
Kalani Reelitz (Principal Financial Officer)
−Removed: /s/ Scott Wahlers Chief Accounting Officer March 1, 2023
+Added: /s/ Scott Wahlers Chief Accounting Officer February 28, 2024
Scott Wahlers (Principal Accounting Officer)
−Removed: /s/ Jeffrey Housenbold Director March 1, 2023
+Added: /s/ Jeffrey Housenbold Director February 28, 2024
Jeffrey Housenbold
−Removed: /s/ Allan Leinwand Director March 1, 2023
+Added: /s/ Allan Leinwand Director February 28, 2024
Allan Leinwand
−Removed: /s/ Frank Martell Director March 1, 2023
+Added: /s/ Frank Martell Director February 28, 2024
Frank Martell
−Removed: /s/ Josh McCarter Director March 1, 2023
+Added: /s/ Josh McCarter Director February 28, 2024
Josh McCarter
−Removed: /s/ Charles Phillips Director March 1, 2023
+Added: /s/ Charles Phillips Director February 28, 2024
Charles Phillips
−Removed: /s/ Steven Sordello Director March 1, 2023
+Added: /s/ Steven Sordello Director February 28, 2024
Steven Sordello
−Removed: /s/ Pamela Thomas-Graham Director March 1, 2023
+Added: /s/ Pamela Thomas-Graham Director February 28, 2024
Pamela Thomas-Graham
−Removed: /s/ Dawanna Williams Director March 1, 2023
+Added: /s/ Dawanna Williams Director February 28, 2024
Dawanna Williams
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.