Modular Medical, Inc. 10-Q

Item 4. Controls and Procedures Disclosure Controls and Procedures. Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. Because of inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, 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. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934. Based on this evaluation, management identified a material weakness in the Company’s internal control over financial reporting in the third quarter of fiscal 2026 related to the accounting for the warrants issued in the public offering completed in December 2025. It was determined that the Company should have accounted for the warrants issued in the public offering as liabilities rather than equity instruments, as the Company did not have a sufficient amount of authorized shares to deliver shares of common stock upon exercise under the terms of the warrants. Based on that evaluation, our management concluded that our disclosure controls and procedures were not effective as of December 31, 2025 as a result of the identified material control weakness. Remediation Plan The Company plans to amend its control activities to remediate the material weakness identified, including hiring additional staff with technical GAAP expertise and utilizing third-party experts to evaluate the accounting for its financing and other complex transactions to ensure compliance with GAAP. The Company believes implementation of these processes and appropriate testing of their effectiveness will remediate this material control weakness. Changes in Internal Control over Financial Reporting. During the three months ended December 31, 2025, there was no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting, except for the planned remedial actions toward the control deficiency identified above. 22 Part II – OTHER INFORMATION