Item 4. Controls and Procedures
Item
4. Controls and Procedures
Evaluation
of Disclosure Controls and Procedures
We
maintain disclosure controls and procedures that are designed to ensure that material information required to be disclosed in our periodic
reports filed under the Securities Exchange Act of 1934, as amended, or 1934 Act, is recorded, processed, summarized, and reported within
the time periods specified in the SECs rules and forms and to ensure that such information is accumulated and communicated to
our management, including our chief executive officer and chief financial officer as appropriate, to allow timely decisions regarding
required disclosure. At the end of the quarter ended March 31, 2019, we carried out an evaluation, under the supervision and with the
participation of our management, including our principal executive officer and the principal financial officer, of the effectiveness
of the design and operation of our disclosure controls and procedures.
We
do not have an audit committee: While we are not currently obligated to have an audit committee, including a member who is an audit
committee financial expert, as defined in Item 407 of Regulation S-K, under applicable regulations or listing standards; however,
it is managements view that such a committee is an important internal control over financial reporting, the lack of which may
result in ineffective oversight in the establishment and monitoring of internal controls and procedures.
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Based
on this evaluation, we determined that as of March 31, 2019, our disclosure controls and procedures were not effective due to the following:
● We
do not have a majority of independent directors on our board of directors, which may result
in ineffective oversight in the establishment and monitoring of required internal controls
and procedures.
● We
have an inadequate number of personnel to properly implement control procedures.
● Due
to the size and lack of resources of our Company, we have not fully developed formal accounting
policies and procedures.
● We
have not properly complied with all aspects of the Internal Control-Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in
2013.
Limitations
on Effectiveness of Controls and Procedures
Our
management, including our Chief Executive Officer (Principal Executive Officer) and Chief Financial Officer (Principal Financial Officer),
does not expect that our disclosure controls and procedures will prevent all errors and all fraud. A control system, no matter how well
conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further,
the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered
relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance
that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include, but
are not limited to, the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error
or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or
by management override of the control. 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 the policies
or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or
fraud may occur and not be detected.
Changes
in Internal Control Over Financial Reporting
There
were no changes in our internal control over financial reporting during the six months ended March 31, 2019 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
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.