Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 3.
Quantitative and Qualitative Disclosures about Market Risk
Not
Applicable. As a smaller reporting company, we are not required to provide the information required by this Item.
Item 4.
Disclosure Controls and Procedures
Management
of the Company is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined
in Exchange Act Rules 13a-15(f) and 15d-15(f). Internal control over financial reporting is a process designed by, or under the
supervision of, our principal executive officer and principal financial officer, or persons performing similar functions, and effected
by our board of directors to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes
those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect
the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary
to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures
of the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that
could have a material effect on the financial statements. Our management evaluated, with the participation of our chief executive officer
and chief financial officer (our “Certifying Officers”), the effectiveness of our disclosure controls and procedures as of
March 31, 2023, pursuant to Rule 13a-15(b) under the Exchange Act. Based upon that evaluation, our Certifying Officers
concluded that, as of the evaluation date, our disclosure controls and procedures were not effective due to the following material weaknesses:
31
● Lack
of sufficient resources necessary to provide adequate segregation of duties related to the
preparation and review of financial information used in financial reporting and review of
controls over the financial reporting process, including documentation of review/approval
of journal entries and reconciliations; and
● Insufficient
IT controls which are effectively designed and implemented, specifically related to user/superuser
access to the Company’s financial reporting system.
The
deficiencies described above if not remedied, could result in a misstatement of one or more account balances or disclosures in our annual
or interim consolidated financial statements that would not be prevented or detected, and, accordingly, we determined that these control
deficiencies constitute a material weakness.
To
address our material weakness, we intend to engage an outside firm to advise on our financial reporting processes and intend to implement
new financial accounting controls and processes. We intend to continue to take steps to remediate the material weakness described above
through implementing enhancements and controls within our accounting systems, subject to budget limitations. We will not be able to remediate
these control deficiencies until these steps have been completed and have been operating effectively for a sufficient period of time
and Management has concluded, through testing, that the controls are operating effectively. The redesign and implementation of improvements
to our accounting and proprietary systems and controls may be costly and time consuming and the cost to remediate may impair our results
of operations in the future.
Because
of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those
systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation,
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.
There
were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the
Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our
internal control over financial reporting.
32
PART
II—OTHER INFORMATION
Item 1.
Legal
Proceedings
None
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.