Item 1A. Risk Factors
Item 1A. Risk Factors.
There have been no material
changes from the risk factors previously disclosed in the Company’s final prospectus for the Initial Public Offering as filed with
the SEC on March 1, 2021 and in the Company’s Form 10-Q as filed with the SEC on May 24, 2021, except for the below:
We have identified
a material weakness in our internal control over financial reporting. This material weakness could continue to adversely affect our ability
to report our results of operations and financial condition accurately and in a timely manner.
Our
management is responsible for establishing and maintaining adequate internal control over financial reporting designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance
with GAAP. Our management is likewise required, on a quarterly basis, to evaluate the effectiveness of our internal controls and to disclose
any changes and material weaknesses identified through such evaluation in those internal controls. A material weakness is a deficiency,
or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material
misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
As
described elsewhere in this Quarterly Report, we identified a material weakness in our internal control over financial reporting related
to the accounting for complex financial instruments as a result of the change in classification of all of our redeemable Class A ordinary
shares as temporary equity and the classification of our warrants as liabilities. As a result of this material weakness, our management
concluded that our internal control over financial reporting was not effective as of September 30, 2021. This material weakness resulted
in a material misstatement of our warrant liabilities, change in fair value of warrant liabilities, additional paid-in capital, accumulated
deficit and related financial disclosures.
To
respond to this material weakness, we have devoted, and plan to continue to devote, significant effort and resources to the remediation
and improvement of our internal control over financial reporting. While we have processes to identify and appropriately apply applicable
accounting requirements, we plan to enhance these processes to better evaluate our research and understanding of the nuances of the complex
accounting standards that apply to our financial statements. Our plans at this time include providing enhanced access to accounting literature,
research materials and documents and increased communication among our personnel and third-party professionals with whom we consult regarding
complex accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance
that these initiatives will ultimately have the intended effects.
Any
failure to maintain such internal control could adversely impact our ability to report our financial position and results from operations
on a timely and accurate basis. If our financial statements are not accurate, investors may not have a complete understanding of our operations.
Likewise, if our financial statements are not filed on a timely basis, we could be subject to sanctions or investigations by the stock
exchange on which our ordinary shares are listed, the SEC or other regulatory authorities. In either case, there could result a material
adverse effect on our business. Failure to timely file will cause us to be ineligible to utilize short form registration statements on
Form S-3 or Form S-4, which may impair our ability to obtain capital in a timely fashion to execute our business strategies or issue shares
to effect an acquisition. Ineffective internal controls could also cause investors to lose confidence in our reported financial information,
which could have a negative effect on the trading price of our securities.
We can give no assurance that
the measures we have taken and plan to take in the future will remediate the material weakness identified or that any additional material
weaknesses or restatements of financial results will not arise in the future due to a failure to implement and maintain adequate internal
control over financial reporting or circumvention of these controls. In addition, even if we are successful in strengthening our controls
and procedures, in the future those controls and procedures may not be adequate to prevent or identify irregularities or errors or to
facilitate the fair presentation of our financial statements.
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