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Item 4. Controls and Procedures

2020-11-05 compared with 2020-08-07 · 74 added, 81 removed, 21 unchanged (88% of the section changed)

Controls and Procedures Evaluation

of Disclosure Controls and Procedures

The term "disclosure

controls and procedures,"

as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, refers to controls

and procedures 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 such information is accumulated and communicated to a company's management, including its principal executive and principal

financial officers, as appropriate to allow timely decisions regarding required disclosure.

In designing and

evaluating our disclosure controls and procedures, management recognizes that disclosure controls and procedures, no matter how

well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls

and procedures are met.

Additionally, in designing disclosure controls and procedures, our management necessarily was required

to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures.

The design of

any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no

assurance that any design will succeed in achieving its stated goals under all potential future conditions;

over time, controls

may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate.

Because of the inherent limitations in a control system, misstatements due to error or fraud may occur and not be detected.

Based on the evaluation

of our disclosure controls and procedures as of June 30, 2020, our Chief Executive Officer and Chief Financial Officer have

concluded that, as of June 30, 2020, our disclosure controls and procedures were not effective at the reasonable assurance

level as a result of the material weaknesses discussed below.

Notwithstanding these material weaknesses, our Chief Executive Officer

and Chief Financial Officer concluded that the financial statements included elsewhere in this Annual Report on Form 10-K

present fairly, in all material respects, our financial position, results of operations and cash flows in conformity with generally

accepted accounting principles, or GAAP.

Controls and Procedures Evaluation of Disclosure

Controls and Procedures

The term "disclosure controls and procedures,"

as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, refers to controls and procedures 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.

controls and procedures include, without limitation, controls and procedures designed to ensure that such information is accumulated

and communicated to a company's management, including its principal executive and principal financial officers, as appropriate

to allow timely decisions regarding required disclosure.

In designing and evaluating our disclosure

controls and procedures, management recognizes that disclosure controls and procedures, no matter how well conceived and operated,

can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met.

Additionally,

in designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the

cost-benefit relationship of possible disclosure controls and procedures.

The design of any system of controls also is based in

part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed

in achieving its stated goals under all potential future conditions;

over time, controls may become inadequate because of changes

in conditions, or the degree of compliance with policies or procedures may deteriorate.

Because of the inherent limitations in

a control system, misstatements due to error or fraud may occur and not be detected.

Based on the evaluation of our

disclosure controls and procedures as of September 30, 2020, our Chief Executive Officer and Chief Financial Officer

have concluded that, as of September 30, 2020, our disclosure controls and procedures were not effective at the

reasonable assurance level as a result of the material weaknesses discussed below.

Notwithstanding these material weaknesses,

our Chief Executive Officer and Chief Financial Officer concluded that the financial statements included elsewhere in this

Quarterly Report on Form 10-Q present fairly, in all material respects, our financial position, results of operations

and cash flows in conformity with generally accepted accounting principles, or GAAP.

Material Weakness

6 unchanged sentences

The material weaknesses that we identified were as follows:

We did not design or maintain an effective

control environment commensurate with our financial reporting requirements.

We lacked a sufficient number of professionals with

an appropriate level of accounting knowledge, training and experience to appropriately analyze, record and disclose accounting

matters timely and accurately.

Additionally, the limited personnel resulted in our inability to consistently establish appropriate

authorities and responsibilities in pursuit of our financial reporting objectives, as demonstrated by, among other things, our

insufficient segregation of duties in our accounting function.

This material weakness further contributed to the material weakness

We did not design or maintain an

effective control environment commensurate with our financial reporting requirements.

We lacked a sufficient number of

professionals with an appropriate level of accounting knowledge, training and experience to appropriately analyze, record and

disclose accounting matters timely and accurately.

Additionally, the limited personnel resulted in our inability to

consistently establish appropriate authorities and responsibilities in pursuit of our financial reporting objectives, as

demonstrated by, among other things, our insufficient segregation of duties in our accounting function.

This material

weakness further contributed to the material weakness below.

We did not design and maintain formal accounting

8 unchanged sentences

statements as of and for the year ended March 31, 2017, which were recorded prior to their issuance.

We have identified

and implemented, and continue to implement, certain remediation efforts to improve the effectiveness of our internal control over

financial reporting and disclosure controls and procedures.

These remediation efforts are ongoing.

The following remedial actions

have been completed as of the quarter ended June 30, 2020:

● We hired a Chief Financial Officer and other additional full-time accounting resources with appropriate levels of experience

and reallocated responsibilities across the accounting organization to provide for segregation of duties and that the appropriate

level of knowledge and experience is applied based on risk and complexity of transactions and tasks under review.

● We have increased the level of involvement and oversight from our new Chief Financial Officer and will maintain this level

of oversight until the control environment and risk assessment processes have matured.

● We engaged a professional accounting services firm to assist us in testing the operating effectiveness of our formal policies,

processes and internal controls for complying with the Sarbanes-Oxley Act, including formal policies, processes and internal controls

to analyze, account for and disclose complex accounting transactions.

● We have performed a detailed financial reporting risk assessment to identify areas that require improvement and developed and

implemented plans to address these areas;

as a result, we have improved documentation of account reconciliations, and management

review procedures and enhanced our GAAP training initiatives in key areas

The process of

implementing an effective financial reporting system is a continuous effort that requires us to anticipate and react to changes

in our business and the economic and regulatory environments and to expend significant resources to maintain a financial reporting

system that is adequate to satisfy our reporting obligations.

As we continue to evaluate and take actions to improve our internal

control over financial reporting, we may take additional actions to address control deficiencies or modify certain of the remediation

measures described above.

While progress

has been made to enhance our internal control over financial reporting, we are still in the process of implementing, documenting

and testing these processes, procedures and controls.

Additional time is required to complete implementation and to assess and

ensure the sustainability of these procedures.

We will continue to devote significant time and attention to these remedial efforts.

However, the material weaknesses cannot be considered remediated until the applicable remedial controls operate for a sufficient

period of time and management has concluded, through testing, that these controls are operating effectively.

Changes in internal control over

financial reporting

Other than the

applicable remediation efforts described above that were implemented or commenced during the three months ended June 30, 2020,

there have been no other changes in our internal control over financial reporting during the three months ended June 30, 2020

that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II —

OTHER INFORMATION

Remediation activities

We identified and completed certain remediation efforts to improve

the effectiveness of our internal control over financial reporting and disclosure controls and procedures.

The following remedial

actions were completed during the three months ended September 30, 2020:

We hired a Vice President of Finance with an appropriate level of experience and reallocated responsibilities within the accounting

organization to ensure there is proper segregation of duties and that the appropriate level of knowledge and experience is applied

during the review of transactions based on the risk and complexity involved.

We increased the level of involvement and oversight from our new Vice President of Finance and will maintain this level of

oversight until the control environment and risk assessment processes have matured.

We continued to test the operating effectiveness of our formal policies, processes and internal controls for compliance with

the Sarbanes-Oxley Act, including processes and internal controls to analyze, account for and disclose complex transactions.

We implemented a new procurement system and updated our process and controls documentation for changes in how procurement related

transactions are initiated, processed, reviewed and approved.

The process of implementing and maintaining

an effective financial reporting system is a continuous effort that requires management to anticipate and react to changes in our

business, economic and regulatory environments and to expend significant resources to maintain a financial reporting system that

is adequate to satisfy our reporting obligations.

As we continue to evaluate our internal control environment, we may take additional

actions to address control deficiencies or modify the remediation measures described above.

While significant progress has been made

to enhance our internal control over financial reporting, we are still in the process of testing these processes, procedures and

controls to ensure they are operating effectively.

Additional time is required to complete our assessment to ensure these new procedures

are sustainable.

While we will continue to devote significant time and attention to these efforts, the material weaknesses previously

identified cannot be considered fully remediated until the applicable remedial controls operate for a sufficient period of time

and management has concluded, through testing, that these controls are operating effectively.

Changes in internal control over financial reporting

Other than the applicable remediation

efforts described above that were implemented or commenced during the three months ended September 30, 2020, there have been

no other changes in our internal control over financial reporting during the three months ended September 30, 2020 that

have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

Legal Proceedings.

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 4. Controls and Procedures