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Evaluation of Disclosure Controls and Procedures
−Removed: Under the supervision and with the participation of our management including our Chief Executive Officer and Interim Chief Financial Officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act") as of the end of the period covered by this report.
−Removed: Our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and our Interim Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.
−Removed: Based on that evaluation, our Chief Executive Officer and Interim Chief Financial Officer have concluded our disclosure controls and procedures were not effective as of June 29, 2024 due to the material weakness in our internal control over financial reporting, as of December 30, 2023.
+Added: Under the supervision and with the participation of our management including our Principal Executive Officer and Principal Financial Officer, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act") as of the end of the period covered by this report.
+Added: Our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and our Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.
+Added: Based on that evaluation, our Principal Executive Officer and Principal Financial Officer have concluded our disclosure controls and procedures were not effective as of September 28, 2024 due to the ongoing material weakness in our internal control over financial reporting identified as of December 30, 2023.
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 in annual or interim financial statements will not be prevented or detected on a timely basis.
Material Weakness and Remediation Plan
−Removed: The identified material weakness in internal control over financial reporting as of December 30, 2023 related to deficiencies in the design and operating effectiveness of certain information technology general computer controls ("ITGC's").
−Removed: In particular, the replacement of components of our enterprise resource planning system in late August 2023 led to a significant increase in the volume of transactions across user access, program change management, and IT operations for which our existing controls for such matters were not designed to address.
+Added: The identified material weakness in internal control over financial reporting relates to deficiencies in the design and operating effectiveness of certain information technology general computer controls ("ITGC's").
+Added: In particular, the replacement of components of our enterprise resource planning system in late August 2023 led to a significant increase in the volume of transactions across user access, program change management, and information technology ("IT") operations for which our existing controls for such matters were not designed to address.
Further, certain of the Company's related business controls that are dependent upon the affected ITGC's were also deemed ineffective as of December 30, 2023.
We have taken, and continue to take, steps to remediate the control deficiencies contributing to the material weakness described above.
−Removed: Management has redesigned controls and implemented additional training for user access, program change management, and IT operations controls.
+Added: Management continues to redesign controls and implement additional training for user access, program change management, and IT operations controls.
Our remediation progress has also included hiring additional internal and external resources.
−Removed: We anticipate the remediation will be completed during the fiscal year ending December 28, 2024, after the applicable controls have operated for a sufficient period of time and management has concluded through testing that the controls are operating effectively.
−Removed: We did not identify any material misstatements to the condensed consolidated financial statements as of and for the fiscal quarter ended June 29, 2024 because of these control deficiencies.
+Added: We currently anticipate the corrective controls to be implemented during the fiscal year ending December 28, 2024.
+Added: The remediation will thereafter be completed after management has concluded through testing that these controls have operated effectively for a sufficient period of time.
+Added: We did not identify any material misstatements to the condensed consolidated financial statements as of and for the fiscal quarter ended September 28, 2024 because of these control deficiencies.
However, the pervasive impact of these control deficiencies to the Company's internal control over financial reporting creates a reasonable possibility that a material misstatement to the condensed consolidated financial statements would not be prevented or detected on a timely basis.
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Changes in Internal Control over Financial Reporting
−Removed: On April 1, 2024, Grocery Outlet Inc., our wholly owned subsidiary, acquired BBGO Acquisition, Inc., a holding company that owns all of the outstanding capital stock of The Bargain Barn Inc., which does business as United Grocery Outlet.
−Removed: (See Note 10 to our condensed consolidated financial statements for additional information).
+Added: On April 1, 2024, Grocery Outlet Inc., our wholly owned subsidiary, acquired BBGO Acquisition, Inc., a holding company that owns all of the outstanding capital stock of The Bargain Barn Inc., which does business as United Grocery Outlet (See Note 10 to the condensed consolidated financial statements for additional information).
We are currently integrating United Grocery Outlet into our internal control framework and processes and, pursuant to the Securities and Exchange Commission's guidance that an assessment of a recently acquired business may be omitted from the scope of an assessment in the year of acquisition, the scope of our assessment of the effectiveness of our internal control over financial reporting as of December 28, 2024 will not include United Grocery Outlet.
−Removed: Other than the remediation efforts and changes identified above, during the three months ended, June 29, 2024, there was no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
+Added: Other than the remediation efforts and changes identified above, during the fiscal quarter ended September 28, 2024 , there was no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Limitations on Effectiveness of Controls
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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.