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
December 31, 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
that could
impact our
system of internal
control, insufficient
controls over internal
information and
information from service
organizations, insufficient
design and implementation
of information technology general
controls
(“ITGCs”), and controls over service
organizations, resulting in ineffective
process level and automated controls,
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 that could impact the
system of internal control, insufficient
controls over
information
from
service
organizations,
insufficient
design
and
implementation
of
ITGCs,
controls
over
service
organizations resulting in ineffective process level and automated controls
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 and implementation
of internal controls.
As a result of insufficient time in implementing all procedures to remediate
the material weaknesses discussed in our Annual
Report on Form10-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 December 31, 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
GAAP.
Remediation Plan
Management has made significant
progress and continues to actively
work on remediating the identified
material weakness and
remains committed to remediating the material weakness in a timely manner.
Our remediation process is ongoing and includes, but is
not limited to, the following steps:
(1)
implementing
our
comprehensive remediation
plan that
encompasses specific
actions aimed
at embedding
accountability
with control owners as well
as training 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 and
embedding accountability on a process and controls level;
(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.
70
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
December 31,
2025, that
have materially
affected, or
are reasonably likely to
materially affect,
our internal
c
ontrol over financial reporting.
71
Part II. Other Information
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