Item 4. Controls and Procedures
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures
that are designed to ensure that material information required to be disclosed in our periodic reports filed or submitted under the Securities
Exchange Act of 1934, as amended, or the Exchange Act, is recorded, processed, summarized and reported within the time periods specified
in the SEC’s rules and forms. Our disclosure controls and procedures are also designed to ensure that information required to be
disclosed in the reports we file or submit under the Exchange Act are accumulated and communicated to our management, including our principal
executive officer and principal financial officer as appropriate, to allow timely decisions regarding required disclosure.
During the quarter ended June 30, 2024, we carried
out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal
financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e)
and 15d-15(e) under the Exchange Act. Based upon that evaluation, our principal executive officer and principal financial officer concluded
that our disclosure controls and procedures were not effective due to the material weakness in our internal controls.
A material weakness is a deficiency, or a combination
of deficiencies, in internal control over financial reporting, such that there is a reasonably possibility that a material misstatement
of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.
Material Weaknesses in Internal Controls
The Company’s management has concluded that
our control around the accounting for certain notes receivable accounted for at fair value and certain long-term investments accounted
for at fair value or with the equity security measurement alternative was not effectively designed or maintained, and therefore initially
were not accounted for correctly. As a result, our management performed additional analysis as deemed necessary to ensure that our financial
statements were prepared in accordance with accounting principles generally accepted in the United States of America. Management understands
that the accounting standards applicable to our financial statements are complex and will seek to enhance controls over its experienced
third-party professionals with whom management can consult with respect to accounting issues and remediate this material weakness.
Changes in Internal Control Over Financial Reporting
We have not made any changes to our internal control
over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended June 30, 2024 that
have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Limitations on Effectiveness of Controls
Our management does not expect that our disclosure
controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived
and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. 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 all control systems, no evaluation of controls can provide absolute assurance that
all control issues and instances of fraud, if any, within our company have been detected.
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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.