Item 4. Controls and Procedures
Item 4.
Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Management, with the participation of the
Company’s Chief Executive Officer and Chief Accounting Officer, evaluated the effectiveness of our disclosure controls and
procedures as of January 31, 2021. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and
15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), means controls and other procedures
of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or
submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s
rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that
information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated
and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate
to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how
well designed and operated, can provide only reasonable assurance of achieving their objectives. Based on the evaluation of our
disclosure controls and procedures as of January 31, 2021, our Chief Executive Officer and Chief Accounting Officer concluded that,
as of such date, as a result of the material weaknesses in internal control over financial reporting that are described below in
Management’s Report on Internal Control Over Financial Reporting, our disclosure controls and procedures were not effective.
As previously reported in our Annual Report
on Form 10-K for the fiscal year ended July 31, 2020 management identified the following material weaknesses in internal control
over financial reporting:
Insufficient Resources: We
have an inadequate number of personnel with requisite expertise in the key functional areas of finance and accounting.
Inadequate Segregation
of Duties: We have an inadequate number of personnel to properly implement segregation of duties control procedures.
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We are committed to improving our internal
control over financial reporting and (1) will continue to use third-party specialists to address shortfalls in staffing and to
assist us with accounting and finance responsibilities; (2) will increase the frequency of independent reconciliations of significant
accounts, which will mitigate the lack of segregation of duties until there are sufficient personnel; and (3) may consider appointing
additional outside directors and audit committee members in the future.
In light of the material weakness described
above, prior to the filing of this Form 10-Q for the period ended January 31, 2021, management determined that key quarterly
controls were performed timely and also performed additional procedures, including validating the completeness and accuracy of
the underlying data used to support the amounts reported in the quarterly financial statements. These control activities and additional
procedures have allowed us to conclude that, notwithstanding the material weaknesses, the financial statements in this Form 10-Q
fairly present, in all material respects, our financial position, results of operations, and cash flows for the periods presented
in conformity with United States GAAP.
Changes in Internal Control Over Financial
Reporting
There
have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
Act) that occurred during the period covered by this Quarterly Report on Form 10-Q that have materially affected, or are reasonably
likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION