Item 4. Controls and Procedures
Item
4. Controls and Procedures
Evaluation
of Disclosure Controls and Procedures
We
maintain a system of disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to provide reasonable assurance that information
required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods
specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including
our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosures.
In
designing and evaluating our disclosure controls and procedures, management recognizes that any disclosure controls and procedures, no
matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition,
the design of disclosure controls and procedures must reflect the fact that there are resource constraints, and that management is required
to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.
The
Company’s management, with the participation of our principal executive officer and principal financial officer, has evaluated
the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) of
the Exchange Act, as of the end of the period covered by this Report.
Based
upon that evaluation , our principal executive officer and principal financial officer concluded that, as of December 31, 2022, our disclosure
controls and procedures were not effective due to the material weaknesses in internal control over financial reporting described below.
Thus, there remains a reasonable possibility that a material misstatement of the Company’s interim financial statements will not
be prevented or detected on a timely basis. This does not include an evaluation by the Company’s registered public accounting firm
regarding the Company’s internal control over financial reporting. Accordingly, we cannot provide reasonable assurance that information
required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported, to
allow our principal financial and executive officers to make timely decisions regarding required disclosures as of December 31, 2022.
Management’s
evaluation was based on the following material weaknesses in our internal control over financial reporting which existed as of March
31, 2022, and which continue to exist, as discussed in the Company’s Annual Report on Form 10-K:
● Inadequate
segregation of duties consistent with control objectives;
● Lack
of independent Board of Directors (as of the balance sheet date) and absence of Audit Committee
to exercise oversight responsibility related to financial reporting and internal control;
● Lack
of risk assessment procedures on internal controls to detect financial reporting risks in
a timely manner; and
● Lack
of documentation on policies and procedures that are critical to the accomplishment of financial
reporting objectives.
39
Our
management will continue to monitor and evaluate the relevance of our risk-based approach and the effectiveness of our internal controls
and procedures over financial reporting on an ongoing basis and is committed to taking further action and implementing additional enhancements
or improvements, as necessary and as funds allow.
Remediation
Plan
Management
continues to implement measures designed to ensure that control deficiencies contributing to the material weakness are remediated, such
that these controls are designed, implemented, and operating effectively.
The
remediation actions planned include:
● Identify
gaps in our skills base and the expertise of our staff required to meet the financial reporting
requirements of a public company;
● Establish
an independent Board of Directors (which we expect to establish in our fourth fiscal quarter
that will end on March 31, 2023) and an Audit Committee to provide oversight for remediation
efforts and ongoing guidance regarding accounting, financial reporting, overall risks and
the internal control environment;
● Retain
additional accounting personnel with public company financial reporting, technical accounting,
SEC compliance, and strategic financial advisory experience to achieve adequate segregation
of duties; and
● Continue
to develop formal policies and procedures on accounting and internal control over financial
reporting and monitor the effectiveness of existing controls and procedures.
Changes
in Internal Control over Financial Reporting
There
have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange
Act) during the fiscal quarter ended December 31, 2022 that have materially affected, or that are reasonably likely to materially affect,
our internal control over financial reporting.
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.