What changed in this filing

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Item 4. Controls and Procedures

2022-03-17 compared with 2021-09-13 · 29 added, 28 removed, 23 unchanged (71% of the section changed)

6 unchanged sentences

Chief Financial Officer concluded that the disclosure controls and procedures were not effective.

We specifically identified a combination

of control deficiencies relating to the accuracy and completeness of our accounting for stock-based compensation awards and inventories

at one of our subsidiaries, which constitute material weaknesses in internal control over financial reporting.

Notwithstanding such material

weaknesses, we believe the financial information presented herein is materially correct and fairly presents the financial position and

operating results of the quarter ended July 31, 2021 in conformity with U.S.

generally accepted accounting principles for interim financial

information and in accordance with the rules and regulations of the SEC.

During the year ended October 31, 2021,

we identified inappropriate system access controls over the financial reporting system.

These controls were not designed to prevent or

detect unauthorized changes to source information, or implement an appropriate level of segregation of duties which ultimately led us

to conclude that this was a material weakness.

Further, during the year ended October 31, 2021, we determined that we lacked adequate

controls with respect to identifying and accounting for material contracts.

This was evidenced by our failure to properly identify and

account for a material lease amendment.

Accordingly, management has determined that this is a control deficiency that constitutes a material

Notwithstanding such material weaknesses, we believe the financial information presented herein is materially correct and fairly

presents the financial position and operating results of the quarter ended January 31, 2022 in conformity with U.S.

generally accepted

accounting principles for interim financial information and in accordance with the rules and regulations of the SEC.

Plan for the Material Weakness

previously disclosed in Item 9A of our Annual Report on Form 10-K for the fiscal year ended October 31, 2021, management has identified

material weaknesses as of that date.

The identified material weaknesses related to the accounting for stock-based compensation awards

and inventories at one of our subsidiaries.

A “material weakness” is a deficiency, or 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.

To remediate the material weakness, we are initiating

controls and procedures in order to:

the importance of a strong control environment, to emphasize the technical requirements for controls that are designed, implemented

and operating effectively and to set the appropriate expectations on internal controls through establishing the related policies

and procedures;

the processes for documenting and alerting key personnel, including our board members, officers, auditors and outside accountants,

of non-reoccurring events related to stock-based compensation awards to ensure such events are timely and adequately recorded and

communicated to the appropriate parties.

have replaced and hired new employees in the accounting department at the subsidiary where the inventory analysis issue occurred

and have made upgrades to the computer systems at the subsidiary.

Further, we hired a new director of finance at the subsidiary that

is responsible for overseeing inventory counts and we are enhancing controls in the inventory business process over (i) inventory

count procedures by requiring more frequent physical audits of our inventory, and (ii) review of inventory adjustments and approvals.

The identified material weaknesses related to inappropriate system access controls over the financial

reporting system and failure to properly identify and account for a material lease amendment.

A “material weakness” is a

deficiency, or 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

To remediate the material weaknesses identified above, we are initiating controls and procedures in order to:

control owners concerning the principles and requirements of each control, with a focus on those related to user access to our financial

reporting systems impacting financial reporting;

and maintaining documentation to promote knowledge transfer upon personnel and function changes;

enhanced controls and reviews related to our financial reporting systems;

an in-depth analysis of who should have access to perform key functions within our financial reporting system that impact financial

reporting and redesigning aspects of the system to better allow the access rights to be implemented.

material weaknesses identified above will not be considered remediated until our remediation efforts have been fully implemented and

11 unchanged sentences

10-K for the year ended October 31, 2021, there was no change in our internal control over financial reporting (as defined in Rules 13a-15(f)

and 15d-15(f) under the Exchange Act) during the fiscal quarter ended July 31, 2021 that has materially affected, or is reasonably likely

to materially affect, our internal control over financial reporting.

and 15d-15(f) under the Exchange Act) during the fiscal quarter ended January 31, 2022 that has materially affected, or is reasonably

likely to materially affect, our internal control over financial reporting.

II - OTHER INFORMATION

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