What changed in this filing

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Item 4. Controls and Procedures

2024-05-08 compared with 2023-11-08 · 82 added, 37 removed, 18 unchanged (87% of the section changed)

1 unchanged sentence

of Disclosure Controls and Procedures

maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act

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

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 chief financial

officer, as appropriate, to allow timely decisions regarding required disclosures.

In designing disclosure controls and procedures, our

management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls

and procedures.

The design of any disclosure controls and procedures also is based in part upon 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

Any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance

of achieving the desired control objectives.

maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) that are

designed to ensure that information required to be disclosed in our reports 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 chief financial officer, as appropriate, to allow timely decisions regarding

required disclosures.

In designing disclosure controls and procedures, our management necessarily was required to apply its judgment

in evaluating the cost-benefit relationship of possible disclosure controls and procedures.

The design of any disclosure controls and

procedures also is based in part upon 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.

Any controls and procedures, no matter how well

designed and operated, can provide only reasonable, not absolute, assurance of achieving the desired control objectives.

management, with the participation of our chief executive officer and chief financial officer, has evaluated the effectiveness of the

3 unchanged sentences

were not effective due to the material weaknesses in internal control over financial reporting described below.

ineffectiveness of the Company’s internal control over financial reporting was due to the following material weaknesses which are

indicative of many small companies with small number of staff:

inadequate segregation

of duties consistent with control objectives;

inadequate controls related

to revenue recognition;

insufficient written policies

and procedures for accounting and financial reporting with respect to the requirements and application of both U.S.

inadequate information

technology general controls specifically related to security, segregation of duties, user access, restricted access and change management.

Report on Internal Control Over Financial Reporting

of our Company and its consolidated subsidiaries is responsible for establishing and maintaining adequate internal control over financial

The Company’s internal control over financial reporting is a process designed under the supervision of its chief executive

and chief financial officers and effected by the Company’s Board of Directors, management, and other personnel, to provide reasonable

assurance regarding the reliability of financial reporting and the preparation of its consolidated financial statements for external

reporting purposes in accordance with U.S.

generally accepted accounting principles.

of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

In addition, projections

of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in

conditions or that the degree of compliance with the policies or procedures may deteriorate.

Weakness in Internal Control over Financial Reporting

assessed the effectiveness of the Company’s internal control over financial reporting as of March 31, 2024, based on the framework

established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations (“COSO”)

of the Treadway Commission.

Based on this assessment, management has determined that the Company’s internal control over financial

reporting was not effective.

material weakness, as defined in the standards established by the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”),

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 our annual or interim financial statements will not be prevented or detected on a timely basis.

identified the following control deficiencies during the year ended December 31, 2023 that constituted material weaknesses:

design, implementation, and operation of controls over program change management, user access and vendor management to ensure:

technology (“IT”) program and data changes affecting the Company’s financial IT applications and underlying accounting

records, are identified, tested, authorized, and implemented appropriately to validate that data produced by its relevant IT systems

were complete and accurate.

Automated process-level and manual controls that are dependent upon the information derived from such

financially relevant systems were also determined to be ineffective as a result of such deficiency;

restrictions that would adequately prevent users from gaining inappropriate access to the financially relevant systems;

third-party service provider Systems and Organizational Controls (“SOC”) reports were obtained and reviewed.

process controls across the entity’s financial reporting processes were not effectively designed and implemented to properly

address the risk of material misstatement from:

evidence to verify the completeness and accuracy of manually generated Information Produced by the Entity (“IPE”) and

system generated IPE;

evidence of formal review and approval procedures of key information utilized in the performance of the control.

is in the process of remediating these identified material weaknesses.

Plan to Remediate the Material Weakness

has been implementing and continues to implement measures designed to ensure that control deficiencies contributing to the material weaknesses

are remediated, such that these controls are designed, implemented, and operating effectively.

The Company has formally documented its

procedures for many of the significant accounting and financial reporting processes, in addition to, identifying and remediating design

deficiencies in its processes.

remediate the identified material weaknesses, our management, with oversight from our audit committee, implemented a remediation plan.

The Company has taken the following remediation steps during the year ended December 31, 2023:

an independent third-party consulting firm to conduct internal control walkthroughs and testing and to provide assistance with deficiency

risk assessments of our financial statement accounts in accordance with the COSO 2013 Framework;

risk and control matrices for critical internal control processes supporting internal control over financial reporting;

key process flowcharts, including documentation of key and compensating controls;

the design and operating effectiveness of our controls;

control gaps and weaknesses in the design and operating effectiveness of our controls;

a ticketing system for user provisioning, modifications, and termination;

information technology change management processes and retention of audit documentation;

policies and procedures related to system backups and monitoring, software development life cycle and cybersecurity;

to formalize user access and change management reviews as well as SOC report reviews for in-scope third-party systems;

our control deficiencies identified to date.

continues to implement measures designed to ensure that control deficiencies contributing to the material weaknesses are remediated,

such that these controls are designed, implemented, and operating effectively.

The other remediation actions planned include:

implementation of controls

to ensure revenue is recognized upon shipment;

further documentation and

implementation of control procedures and the implementation of control monitoring;

identify and remedy gaps

in our information technology general controls specifically related to the areas of security, segregation of duties, user access,

restricted access and change management.

to formalize accounting and financial reporting policies and procedures including entity-level controls and segregation of duties

review and analysis;

evidence of the completeness and accuracy of manually generated IPE and system generated IPE;

documentation and evidence of review of controls;

to formalize user access and change management reviews as well as SOC report reviews for in-scope third-party systems.

remediation plan, once fully implemented and determined to be operating effectively, is expected to result in the remediation of the

identified material weaknesses in internal controls over financial reporting.

We are committed to maintaining a strong internal control

environment and believe that these remediation efforts will represent significant improvements in our control environment.

Our management

will continue to monitor and evaluate the relevance of our risk-based approach and the effectiveness of our internal controls and procedures

over financial reporting on an ongoing basis and is committed to taking further action and implementing additional enhancements or improvements,

as necessary.

material weaknesses did not result in a misstatement of the company’s financial statements;

however, they could have resulted in

misstatements of interim or annual consolidated financial statements and disclosures that would result in a material misstatement that

would not be prevented or detected.

in Internal Control over Financial Reporting

1 unchanged sentence

our internal control over financial reporting.

Other than those measures, there were no changes in our internal control over financial

reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended September 30, 2023, that

materially affected, our internal control over financial reporting as of that date.

Other than those measures, there have been no changes in our internal control over financial

reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended March 31, 2024 that materially

affected our internal control over financial reporting as of that date.

II – OTHER INFORMATION

5 unchanged sentences

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