Item 4. Controls and Procedures
Item 4. Controls and Procedures
Under
the
supervision
and
with
the
participation
of
our
management,
including
our
executive
chairman
and
our
group
chief
financial officer, we conducted
an evaluation of our disclosure controls and procedures, as such term is defined
under Rule 13a-15(e)
promulgated under the Securities Exchange Act of 1934, as amended, as of
September 30, 2025.
We previously identified and disclosed in Part II, Item 9A of our Annual Report on Form 10-K for the
year ended June 30, 2025,
material weaknesses in our internal control over financial reporting related
to:
(1)
Our
Consumer
lending
process,
specifically
insufficient
risk
assessment
and
monitoring
activities
relating
to
changes
in
systems
and
processes,
insufficient
controls
over
internal
information
and
information
from
service
organizations,
insufficient
design
and
implementation
of
information
technology
general
controls
(“ITGCs”),
controls
over
service
organizations,
resulting
in
ineffective
process
level,
including
a
lack
of
validation
of
the
completeness
and
accuracy
of
information used within the process;
(2)
Our payroll process, specifically
insufficient risk assessment
and monitoring activities relating
to changes over the
transfer
of
ownership
to
the
centralized
payroll
processes,
insufficient
controls
over
information
from
service
organizations,
insufficient design
and implementation
of ITGCs, controls
over service organizations
resulting in ineffective
process level
including a lack of validation of the completeness and accuracy of information used
within this process;
(3)
Our annual
goodwill impairment
process,
specifically
related
to insufficient
risk assessments,
and
ineffective
design and
implementation of controls resulting in ineffective process level
controls;
(4)
Our business combination
process, specifically insufficient
risk assessments, and
ineffective design
and implementation of
controls
over the
purchase price
allocation of
the Adumo
and Recharger
acquisitions including
insufficient
controls over
information resulting in ineffective process level controls including a lack of validation of the completeness and accuracy
of
information used;
(5)
Our
revenue
recognition
process
relating
to
prepaid
airtime
sold
and
processing
fees
relating
to
certain
agreements,
specifically insufficient risk assessment and ineffective design and implementation of
controls related to our judgement over
revenue recognized
either as principal
versus as agent
resulting in
ineffective controls
and a material
misstatement as well
as the requirement to restate revenue, cost of goods sold, IT processing, servicing and support and related disclosures for all
quarters as described below;
(6)
Our journal
entry process, specifically
relating to
insufficient risk
assessments, and
ineffective design
and implementation
of controls including insufficient controls over information resulting in ineffective process level controls including a lack of
validation of the completeness
of the journal entry
population and a lack of
validation of the completeness
and accuracy of
information used within the process; and
(7)
An insufficient number of experienced and trained resources and an insufficient understanding
of the application of internal
controls over
financial reporting
across the Southern
African businesses resulting
in ineffective
design, implementation
of
internal
controls.
As a result of
insufficient time to design, implement and
fully test controls to
ensure we have remediated the
material weaknesses
discussed in our
Annual Report on
Form 10-K for
our fiscal year
ended June 30,
2025 (as described
above), the executive
chairman
and the
group chief
financial officer
concluded that
our disclosure
controls and
procedures were
not effective
as of
September
30,
2025.
Notwithstanding
the
previously
identified
material
weaknesses,
management
believes
the
condensed
consolidated
financial
statements included
in this Quarterly
Report on
Form 10-Q fairly
present, in
all material respects,
our financial
condition, results
of
operations and cash flows as of and for the periods presented in accordance with
U.S. GAAP.
Remediation Plan
Management has made
progress and continues
to actively work
on remediating the
identified material weaknesses
and remains
committed to
remediating the
material weaknesses
in a
timely manner.
Our remediation
process is ongoing
and includes,
but is
not
limited to, the following steps:
(1)
developing
and
implementing
a
comprehensive
remediation
plan
that
includes
specific
actions
aimed
at
embedding
accountability
with
control
owners
related
to
the
operation
and
importance
of
internal
controls
over
financial
reporting,
including
the principles
and requirements
of each
control, with
a
focus
on the
impacted
processes,
controls
over
service
organizations, ITGCs, other process level controls;
(2)
mandating improved risk assessment procedures with governance requirements upon implementing new systems within our
company together with the design, implementation and monitoring
of control activities;
(3)
the recruitment of additional
appropriately skilled resources
across the Finance
and Risk and
Compliance disciplines coupled
with the further upskilling and training of existing resources responsible
for the execution of key controls as well as a focus
on a greater degree of automation of controls throughout the organization;
(4)
embedding of controls compliance in the key performance indicators of
senior executives across the business; and
(5)
collaborating closely with internal and external assurance partners to ensure
the robustness of our remediation plan.
The remediation plan
with respect to the
material weaknesses identified for
the year ended June
30, 2025 may be
adjusted as is
appropriate,
as
we
continue
to
evaluate
and
enhance
our
internal
control
over
financial
reporting.
Other
than
the
design
and
implementation of
the remediation
plan, there
have not
been any
changes in
our internal
control over
financial reporting
during the
fiscal quarter ended September
30, 2025, that have
materially affected, or are
reasonably likely to materially
affect, our internal control
o
ver financial reporting.
53
Part II. Other Information
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