What changed in this filing

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Item 4. Controls and Procedures

2021-05-13 compared with 2020-11-12 · 72 added, 39 removed, 3 unchanged (97% of the section changed)

CONTROLS AND PROCEDURES.

of Disclosure Controls and Procedures

maintains “disclosure controls and procedures,”

as such term is defined in Rule 13a-15(e) under the Securities Exchange

Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in our Exchange

Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms, and

that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial

Officer, to allow timely decisions regarding required disclosure.

connection with the preparation of this Quarterly Report on Form 10-Q, an evaluation was carried out by management, with the participation

of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as

defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of September 30, 2020.

upon this evaluation, management concluded that our disclosure controls and procedures were not effective due to a deficiency

in our internal control over financial reporting.

The deficiency relates to proper accounting and valuation of equity instruments

recorded within share-based compensation expense.

material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that a reasonable

possibility exists that a material misstatement of our financial statements will not be prevented or detected on a timely basis.

The deficiency described above constitutes a material weakness given its potential impact on our financial reporting and internal

control over financial reporting.

has evaluated remediation plans for the deficiency and has implemented changes to address the material weakness identified.

remedial controls must operate for a sufficient period of time for a definitive conclusion, through testing, that the deficiency

has been fully remediated and, as such, we can give no assurance that the measures we have undertaken have fully remediated the

material weakness that we have identified.

We will continue to monitor the effectiveness of these and other processes, procedures,

and controls and will make any further changes that management determines to be appropriate.

Notwithstanding

the material weakness described above, management has concluded that our consolidated financial statements included in the Quarterly

Report on Form 10-Q for the three-month period ended September 30, 2020 are fairly stated in all material respects in accordance

with generally accepted accounting principles in the United States of America for each of the periods presented and that these

financial statements may be relied upon.

in Internal Controls over Financial Reporting

of the end of the period covered by this report, other than as described below, there have been no changes in the internal controls

over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial

reporting subsequent to the date of management’s last evaluation.

Management has implemented additional controls to address

and remediate the material weakness identified as discussed above.

Evaluation of Disclosure Controls and Procedures

Management maintains “disclosure controls

and procedures,”

as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”),

that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and

reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to management,

including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

In making this assessment, management used the

criteria set forth by the COSO framework.

Based on evaluation under these criteria, management determined, based upon the existence of

the material weaknesses described below, that we did not maintain effective internal control over financial reporting as of March 31,

A material weakness is a deficiency, or a combination of deficiencies,

in internal control over financial reporting, such that a reasonable possibility exists that a material misstatement of our annual or

interim financial statements would not be prevented or detected on a timely basis.

The Company did not design and implement effective

control activities based on the criteria established in the COSO framework.

Specifically, these control deficiencies constitute material

weaknesses, either individually or in the aggregate, relating to:

(i) selecting and developing control activities and information technology

that contribute to the mitigation of risks and support achievement of objectives;

and (ii) deploying control activities through policies

that establish what is expected and procedures that put policies into action.

The following were contributing factors to the

material weaknesses in control activities:

Insufficient resources within the accounting and financial reporting department to review the accounting for warrant compensation accounting, share-based compensation accounting, and accounting for rebates.

Inadequate segregation of duties within the bank accounts.

Ineffective information technology general controls (ITGCs) in the areas of user access over certain information technology (IT) systems that support the Company’s financial reporting processes.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control

over financial reporting during the most recent fiscal quarter, that have materially affected, or are reasonably likely to materially

affect, our internal control over financial reporting, except for the implementation of remediation plans for the deficiency to address

the material weakness identified.

Remediation Plan and Status

Our remediation efforts are ongoing and we will continue our initiatives

to implement and document policies, procedures, and internal controls.

Remediation efforts will include but are not limited to new hires

in critical positions to improve segregation of duties, supervision and oversight, as well as implementation of technologies to improve

effective controls.

Remediation of the identified material weaknesses

and strengthening our internal control environment will require a substantial effort throughout 2021 and beyond, as necessary.

test the ongoing operating effectiveness of the new and existing controls in future periods.

The material weaknesses cannot be considered

completely remediated until the applicable controls have operated for a sufficient period of time and management has concluded, through

testing, that these controls are operating effectively.

While we believe the steps taken to date and those

planned for implementation will improve the effectiveness of our internal control over financial reporting, we have not completed all

remediation efforts identified herein.

Accordingly, as we continue to monitor the effectiveness of our internal control over financial

reporting in the areas affected by the material weaknesses described above, we have and will continue to perform additional procedures

prescribed by management, including the use of manual mitigating control procedures and employing any additional tools and resources deemed

necessary, to ensure that our consolidated financial statements are fairly stated in all material respects.

Inherent Limitations on Effectiveness of Controls

Management, including our CEO, does not expect

that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud.

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, misstatements, errors, and instances of fraud, if any, within our

organization have been or will be prevented or detected.

These inherent limitations include the realities

that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

Controls also can be

circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls.

design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance

that any design will succeed in achieving its stated goals under all potential future conditions.

Projections of any evaluation of controls

effectiveness to future periods are subject to risks.

Over time, internal controls may become inadequate as a result of changes in conditions,

or through the deterioration of the degree of compliance with policies or procedures.

PART II –

OTHER INFORMATION

Legal Proceedings

a smaller reporting company, we are not required to provide the information required by this item.

Unregistered Sales of Equity Securities and Use of Proceeds

Defaults upon Senior Securities

Mine Safety Disclosures

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.

What changed 10-Q

Item 4. Controls and Procedures